4Q15 EX 99 - ARETitle 4Q15 EX 99.1 Created Date 20160210737

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Table of ContentsDecember 31, 2015

Alexandria Real Estate Equities, Inc. All Rights Reserved. © 2016 iii

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EARNINGS PRESS RELEASE

Fourth Quarter and Year Ended December 31, 2015, Financial and Operating Results....

Guidance .............................................................................................................................

Earnings Call Information and About the Company ..........................................................

Consolidated Statements of Income ...................................................................................

Consolidated Balance Sheets ..............................................................................................

Funds From Operations and Adjusted Funds From Operations .........................................

SUPPLEMENTAL INFORMATION

Company Profile .................................................................................................................

NAV, FFO, and Common Stock Dividends Per Share........................................................

High-Quality, Diversified, and Innovative Tenants............................................................

Class A Assets in AAA Locations.......................................................................................

Solid Occupancy .................................................................................................................

Investor Information ...........................................................................................................

Financial and Asset Base Highlights ..................................................................................

Operating Information

Key Operating Metrics........................................................................................................

Same Property Performance ...............................................................................................

Leasing Activity..................................................................................................................

Contractual Lease Expirations ............................................................................................

Top 20 Tenants....................................................................................................................

Summary of Properties and Occupancy..............................................................................

Property Listing ..................................................................................................................

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SUPPLEMENTAL INFORMATION (continued)

Investments in Real Estate

Key Real Estate Metrics .....................................................................................................

LEED Certification .............................................................................................................

Investments in Real Estate..................................................................................................

Development and Redevelopment Projects Placed into Service in 2015 ...........................

Visible Growth Pipeline:

Highly Leased Projects to Be Placed into Service by 4Q16 ............................................

Projects to Be Placed into Service in 2017 and 2018.......................................................

Key Future Projects ............................................................................................................

Projected Capital Allocation and Construction Spending...................................................

Historical Construction Spending.......................................................................................

Pro Rata Operating and Balance Sheet Information...........................................................

Real Estate Joint Ventures:

Consolidated.....................................................................................................................

Unconsolidated.................................................................................................................

Dispositions ........................................................................................................................

Non-Real Estate Investments..............................................................................................

Balance Sheet

Key Credit Metrics..............................................................................................................

Summary of Debt................................................................................................................

Definitions and Reconciliations ..........................................................................................

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This document includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Please see page 4 of the earnings press release for further information.

This document is not an offer to sell or a solicitation to buy securities of Alexandria Real Estate Equities, Inc. Any offers to sell or solicitations to buy our securities shall be made only by means of a prospectus approved for that purpose. Unless otherwise indicated, the “Company,” “Alexandria,” “ARE,” “we,” “us,” and “our” refer to Alexandria Real Estate Equities, Inc. and its consolidated subsidiaries.

Alexandria Real Estate Equities, Inc. All Rights Reserved. © 2016 1

Alexandria Real Estate Equities, Inc. Reports

Fourth Quarter and Year Ended December 31, 2015Financial and Operating Results

FFO Per Share – Diluted, as Adjusted, of $5.25 for 2015, up 9.4% over 2014EPS – Diluted of $1.63 for 2015, up 61.4% over 2014

Total Revenues of $843.5 million for 2015, up 16.0% over 2014NOI of $585.6 million for 2015, up 15.1% over 2014

Completed Sales of Partial Interest in Three Core Class A Assets in 4Q15 for $453.1 Million at an Average Cap Rate of 4.6% to a High-Quality Institutional Investor

PASADENA, Calif. – February 1, 2016 – Alexandria Real Estate Equities, Inc. (NYSE:ARE) today announced financial and operating results for the fourth quarter and year ended December 31, 2015.

Joel S. Marcus, chairman, chief executive officer, and founder of Alexandria Real Estate Equities, Inc., stated, “We concluded another very successful year where our best-in-class team delivered strong results and continued growth,” including the following key highlights:

• Funds from operations (“FFO”) per share – diluted, as adjusted, of $1.33, up 8.1% for 4Q15, compared to $1.23 for 4Q14; and $5.25, up 9.4%, for 2015, compared to $4.80 for 2014;

• In December 2015, we completed $453.1 million in sales of partial interest in three Class A assets at an average capitalization rate of 4.6%;

• $2.0 billion of liquidity as of 4Q15;• 6.6x net debt to adjusted EBITDA – 4Q15 annualized; with goal of achieving less than 6.0x;• 7.0x net debt to adjusted EBITDA – 4Q15 trailing 12 months;• Executed leases for 1.0 million rentable square feet (“RSF”) and 5.0 million RSF during 4Q15

and 2015, respectively; the highest annual leasing volume in the Company’s 20-year history;• Rental rate increases of 19.8% and 7.3% (cash basis) for 4Q15 lease renewals and re-leasing

of space aggregating 0.5 million RSF (included in the 1.0 million RSF above);• Highly leased value-creation pipeline:

• 89% leased, 1.5 million RSF, targeted for completion in 2016 (weighted toward 4Q16), expected to generate $75 to $80 million of incremental annual net operating income (“NOI”) upon stabilization

• 67% leased, 1.9 million RSF, targeted for completion in 2017 and 2018, expected to generate $105 to $110 million of incremental annual NOI upon stabilization

• Same properties NOI growth of 1.3% and 2.0% (cash basis) for 4Q15, compared to 4Q14; • Same properties NOI growth of 1.3% and 4.7% (cash basis) for 2015 compared to 2014;• In November 2015, we completed an offering of $300.0 million of unsecured senior notes

payable at a stated interest rate of 4.30% with a maturity of January 15, 2026;

• In 4Q15, proceeds from sales of equity investments and investment income from life science entities aggregated $27.5 million and $7.7 million, respectively;

• During 4Q15, we sold an aggregate of 832,982 shares of common stock under our ATM program for gross proceeds of $75.0 million, or $90.04 per share, and net proceeds of approximately $73.9 million; and

• Common stock dividend for 2015 of $3.05 per common share, up 17 cents, or 5.9%, over 2014; continuation of strategy to share growth in cash flows from operating activities with our stockholders while also importantly retaining capital for reinvestment.

Sales of partial interest in core Class A assets at 4.6% cash cap rate to TIAA-CREF

Partial InterestCash Cap

RateProperty Submarket RSF SoldSales Price

(in thousands)225 Binney Street Cambridge 305,212 70% $ 190,110 4.5%409/499 Illinois Street Mission Bay/SoMa 455,069 40% 189,600 4.51500 Owens Street Mission Bay/SoMa 158,267 49.9% 73,353 4.8

918,548 $ 453,063 4.6%

Refer to our “Dispositions” section on page 48 of our Supplemental Information package for additional information on our asset sales.

Results

• FFO attributable to Alexandria Real Estate Equities, Inc.’s (“Alexandria’s”) common stockholders – diluted, as adjusted:

2015 2014 ChangeIn Millions

Fourth Quarter $ 95.8 $ 87.9 $ 7.9 9.0%Year $ 375.8 $ 341.6 $ 34.2 10.0%

Per ShareFourth Quarter $ 1.33 $ 1.23 $ 0.10 8.1%Year $ 5.25 $ 4.80 $ 0.45 9.4%

• Net income (loss) attributable to Alexandria’s common stockholders – diluted:


Fourth Quarter $ 35.1 $ (16.2) $ 51.3 N/AYear $ 116.9 $ 72.1 $ 44.8 62.1%

Per ShareFourth Quarter $ 0.49 $ (0.23) $ 0.72 N/AYear $ 1.63 $ 1.01 $ 0.62 61.4%

Fourth Quarter and Year Ended December 31, 2015, Financial and Operating ResultsDecember 31, 2015


Core operating metrics

• Total revenues:



• NOI, including our pro rata share of consolidated and unconsolidated real estate joint ventures:



• Total annualized base rent (“ABR”): 54% generated from investment-grade tenants• Top 20 tenants generate 49.4% of total ABR:

• 81% of ABR generated from investment-grade tenants • 8.3 years weighted average remaining lease term

• Executed leases for 1.0 million RSF during 4Q15, including:• 170,523 RSF to Vertex Pharmaceuticals Incorporated at 3115/3215 Merryfield Row in our

Torrey Pines submarket• 71,010 RSF to Juno Therapeutics, Inc. at 400 Dexter Avenue North in our Lake Union

submarket• 19.8% and 7.3% (cash basis) rental rate increases on lease renewals and re-leasing of space

aggregating 480,963 RSF• Executed leases for 5.0 million RSF during 2015, the highest annual leasing volume in the

Company’s 20-year history:• 19.6% and 9.9% (cash basis) rental rate increases on lease renewals and re-leasing of space

aggregating 2,209,893 RSF• Same property NOI growth:

• 1.3% and 2.0% (cash basis) increase for 4Q15, compared to 4Q14• 1.3% and 4.7% (cash basis) increase for 2015, compared to 2014

• Occupancy for operating properties in North America of 97.2% as of 4Q15• Operating margin at 69% for 4Q15• Adjusted EBITDA margin at 65% for 4Q15

External growth: visible, multiyear, highly leased value creation pipeline

• Highly leased development and redevelopment projects:• 89% leased, 1.5 million RSF, targeted for completion in 2016 (weighted toward 4Q16),

expected to generate $75 to $80 million of incremental annual NOI upon stabilization• 67% leased, 1.9 million RSF, targeted for completion in 2017 and 2018, expected to generate

$105 to $110 million of incremental annual NOI upon stabilization• 4Q15 commencements of development and redevelopment projects, include:

• 61,755 RSF development project at 4796 Executive Drive in our University Town Center submarket; 100% leased to Otonomy, Inc.

• 48,880 RSF redevelopment project at 10151 Barnes Canyon in our Sorrento Mesa submarket

Balance sheet

• $2.0 billion of liquidity as of 4Q15• 6.6x net debt to adjusted EBITDA – 4Q15 annualized; with goal of achieving less than 6.0x • 6.9x net debt to adjusted EBITDA – 4Q15 annualized, excluding $7.7 million of investment

income for 4Q15• 7.0x net debt to adjusted EBITDA – 4Q15 trailing 12 months • 3.6x fixed charge coverage ratio – 4Q15 annualized• In November 2015, we completed an offering of $300.0 million of unsecured senior notes

payable at a stated interest rate of 4.30% with a maturity of January 15, 2026• In 4Q15, proceeds from sales of equity investments and investment income from life science

entities aggregated $27.5 million and $7.7 million, respectively• During 4Q15, we sold an aggregate of 832,982 shares of common stock under our ATM

program for gross proceeds of $75.0 million, or $90.04 per share, and net proceeds of approximately $73.9 million

• In October 2015, we closed a secured construction loan with commitments available for borrowing aggregating $350.0 million, bearing interest at a rate of LIBOR+1.50%, for our 98% leased development project at 50/60 Binney Street in our Cambridge submarket

• $10.9 billion total market capitalization as of 4Q15• 15% of gross investments in real estate in value-creation pipeline as of 4Q15, with a target

range from 10% to 15% as of 4Q16• Limited debt maturities through 2018 and well-laddered maturity profile• 12% unhedged variable-rate debt as a percentage of total debt as of 4Q15

LEED certifications

• 57% of our total ABR will be generated from LEED projects upon completion of our in-process projects

• During 2015, we received Gold certifications at 360 Longwood Avenue in our Longwood Medical Area submarket and 3033 Science Park Road in our Torrey Pines submarket

GuidanceDecember 31, 2015

(Dollars in thousands, except per share amounts)


The following updated guidance is based on our current view of existing market conditions and other assumptions for the year ending December 31, 2016. There can be no assurance that actual amounts will be materially higher or lower than these expectations. See our discussion of “forward-looking statements” on page 4.

Key sources and uses for 2016 have been updated to reflect a $100 million decrease in construction spending primarily due to the timing of construction spending related to projects expected to be placed into service in 2017 and 2018, as well as updates in the scope of several projects. The mid-point of construction of $850 million is projected to be funded by $375 million of internally generated sources (net cash provided by operating activities after dividends and debt from growth in EBITDA), $350 million of asset sales (minimum target), and $125 million of other capital, including sales of “available-for-sale” equity securities.

EPS and FFO Per Share Attributable to Alexandria’s Common Stockholders – DilutedEarnings per share $1.44 to $1.64Add: depreciation and amortization 4.00Other (0.03)FFO per share $5.41 to $5.61

2016 GuidanceKey Assumptions Low HighOccupancy percentage for operating

properties in North America as of December 31, 2016 96.5% 97.1%

Lease renewals and re-leasing of space:Rental rate increases 14.0% 17.0%Rental rate increases (cash basis) 6.0% 9.0%

Same Property performance:NOI increase 2.0% 4.0%NOI increase (cash basis) 3.5% 5.5%

Straight-line rent revenue $ 51,000 $ 56,000General and administrative expenses $ 59,000 $ 64,000Capitalization of interest $ 45,000 $ 55,000Interest expense $ 108,000 $ 118,000

Key Credit Metrics 2016 GuidanceNet debt to Adjusted EBITDA – 4Q annualized 6.5x to 6.9xFixed charge coverage ratio – 4Q annualized 3.0x to 3.5xValue-creation pipeline as a percentage of gross investments in real

estate as of December 31, 2016 10% to 15%

2016 GuidanceKey Sources and Uses of Capital Low High Mid-PointSources of capital for construction:

Net cash provided by operating activities after dividends $ 115,000 $ 135,000 $ 125,000Debt funding from growth in EBITDA 260,000 240,000 250,000

Internally generated sources 375,000 375,000 375,000Asset sales (minimum target) 300,000 400,000 350,000Other capital/sales of “available-for-sale” equity securities 125,000 125,000 125,000

Total sources/projected construction uses $ 800,000 $ 900,000 $ 850,000

Sources of capital for acquisitions:Debt funding from growth in EBITDA $ 45,000 $ 45,000 $ 45,000Other capital 105,000 205,000 155,000

Total sources/projected acquisitions uses $ 150,000 $ 250,000 $ 200,000

Incremental debt:Issuance of unsecured senior notes payable $ 400,000 $ 550,000 $ 475,000Borrowings under secured construction loans 175,000 225,000 200,000Repayments of secured notes payable (120,000) (220,000) (170,000)Activity on unsecured senior line of credit/other (150,000) (270,000) (210,000)

Incremental debt (1) $ 305,000 $ 285,000 $ 295,000

(1) Included in sources of capital above.

Earnings Call Information and About the CompanyDecember 31, 2015


We will host a conference call on Tuesday, February 2, 2016, at 3:00 p.m. Eastern Time (“ET”)/noon Pacific Time (“PT”) that is open to the general public to discuss our financial and operating results for the fourth quarter and year ended December 31, 2015. To participate in this conference call, dial (877) 719-9789 or (719) 325-4799 and confirmation code 3794612 shortly before 3:00 p.m. ET/noon PT. The audio webcast can be accessed at: www.are.com, in the “For Investors” section. A replay of the call will be available for a limited time from 6:00 p.m. ET/3:00 p.m. PT on Tuesday, February 2, 2016. The replay number is (888) 203-1112 or (719) 457-0820, and the confirmation code is 3794612.

Additionally, a copy of this Earnings Press Release and Supplemental Information for the fourth quarter and year ended December 31, 2015, is available in the “For Investors” section of our website at www.are.com or by following this link: http://www.are.com/fs/2015q4.pdf.

For any questions, please contact Joel S. Marcus, chairman, chief executive officer, and founder, at (626) 578-9693 or Dean A. Shigenaga, executive vice president and chief financial officer, at (626) 578-0777.

About the Company

Alexandria Real Estate Equities, Inc. (NYSE:ARE) is a fully integrated, self-administered and self-managed urban office real estate investment trust (“REIT”) uniquely focused on collaborative science and technology campuses in AAA innovation cluster locations with a total market capitalization of $10.9 billion as of December 31, 2015, and an asset base of 32.0 million square feet, including 20.1 million RSF of operating properties and development and redevelopment projects (under construction or pre-construction), as well as an additional 11.9 million square feet of future ground-up development projects. Alexandria pioneered this niche in 1994 and has since established a dominant market presence in key locations, including Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland, and Research Triangle Park.

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This document includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, without limitation, statements regarding our 2016 earnings per share attributable to Alexandria’s common stockholders – diluted, 2016 FFO per share attributable to Alexandria’s common stockholders – diluted, NOI, and our projected sources and uses of capital. You can identify the forward-looking statements by their use of forward-looking words, such as “forecast,” “guidance,” “projects,” “estimates,” “anticipates,” “believes,” “expects,” “intends,” “may,” “plans,” “seeks,” “should,” or “will,” or the negative of those words or similar words. These forward-looking statements are based on our current expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts, as well as a number of assumptions concerning future events. There can be no assurance that actual results will not be materially higher or lower than these expectations. These statements are subject to risks, uncertainties, assumptions, and other important factors that could cause actual results to differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include, without limitation, our failure to obtain capital (debt, construction financing, and/or equity) or refinance debt maturities, increased interest rates and operating costs, adverse economic or real estate developments in our markets, our failure to successfully place into service and lease our existing space held for redevelopment and new properties acquired for that purpose and any properties undergoing development, our failure to successfully operate or lease acquired properties, decreased rental rates, increased vacancy rates or failure to renew or replace expiring leases, defaults on or non-renewal of leases by tenants, general and local economic conditions, a favorable capital market environment, performance of our operations in areas such as current and future development and redevelopment projects being placed into service, leasing activity, lease renewals, and other risks and uncertainties detailed in our filings with the Securities and Exchange Commission (“SEC”). Accordingly, you are cautioned not to place undue reliance on such forward-looking statements. All forward-looking statements are made as of the date of this earnings press release, and unless otherwise stated, we assume no obligation to update this information and expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For more discussion relating to risks and uncertainties that could cause actual results to differ materially from those anticipated in our forward-looking statements, and risks to our business in general, please refer to our SEC filings, including our most recent annual report on Form 10-K and any subsequent quarterly reports on Form 10-Q.

Consolidated Statements of IncomeDecember 31, 2015

(In thousands, except per share amounts)


Three Months Ended Year Ended 12/31/15 9/30/15 6/30/15 3/31/15 12/31/14 12/31/15 12/31/14Revenues:Rental $ 158,100 $ 155,311 $ 151,805 $ 143,608 $ 140,873 $ 608,824 $ 544,153Tenant recoveries 54,956 56,119 49,594 48,394 45,282 209,063 173,480Other income 10,899 7,180 2,757 4,751 2,519 25,587 9,244

Total revenues 223,955 218,610 204,156 196,753 188,674 843,474 726,877

Expenses:Rental operations 68,913 68,846 62,250 61,223 56,881 261,232 219,164General and administrative 15,102 15,143 14,989 14,387 13,861 59,621 53,530Interest 28,230 27,679 26,668 23,236 22,188 105,813 79,299Depreciation and amortization 72,245 67,953 62,171 58,920 57,973 261,289 224,096Impairment of real estate 8,740 — — 14,510 51,675 23,250 51,675Loss on early extinguishment of debt — — 189 — — 189 525

Total expenses 193,230 179,621 166,267 172,276 202,578 711,394 628,289

Equity in (loss) earnings of unconsolidated real estate joint ventures (174) 710 541 574 554 1,651 554Gain on sales of real estate – rental properties 12,426 — — — — 12,426 —Income (loss) from continuing operations 42,977 39,699 38,430 25,051 (13,350) 146,157 99,142

(Loss) income from discontinued operations — — — (43) 1,722 (43) 1,233Gain on sales of real estate – land parcels — — — — 5,598 — 6,403Net income (loss) 42,977 39,699 38,430 25,008 (6,030) 146,114 106,778Net income attributable to noncontrolling interests (972) (170) (263) (492) (1,362) (1,897) (5,204)Net income (loss) attributable to Alexandria Real Estate Equities, Inc. 42,005 39,529 38,167 24,516 (7,392) 144,217 101,574Dividends on preferred stock (6,246) (6,247) (6,246) (6,247) (6,284) (24,986) (25,698)Preferred stock redemption charge — — — — (1,989) — (1,989)Net income attributable to unvested restricted stock awards (628) (623) (630) (483) (489) (2,364) (1,774)Net income (loss) attributable to Alexandria Real Estate Equities, Inc.’scommon stockholders $ 35,131 $ 32,659 $ 31,291 $ 17,786 $ (16,154) $ 116,867 $ 72,113

Earnings per share attributable to Alexandria’s common stockholders –basic and diluted:Continuing operations $ 0.49 $ 0.46 $ 0.44 $ 0.25 $ (0.25) $ 1.63 $ 0.99Discontinued operations — — — — 0.02 — 0.02Earnings per share – basic and diluted $ 0.49 $ 0.46 $ 0.44 $ 0.25 $ (0.23) $ 1.63 $ 1.01

Weighted-average shares of common stock outstanding for calculatingearnings per share attributable to Alexandria’s common stockholders –basic and diluted 71,833 71,500 71,412 71,366 71,314 71,529 71,170

Dividends declared per share of common stock $ 0.77 $ 0.77 $ 0.77 $ 0.74 $ 0.74 $ 3.05 $ 2.88

Consolidated Balance SheetsDecember 31, 2015

(In thousands)


12/31/15 9/30/15 6/30/15 3/31/15 12/31/14Assets

Investments in real estate $ 7,629,922 $ 7,527,738 $ 7,321,820 $ 7,268,031 $ 7,108,610Investments in unconsolidated real estate joint ventures 127,212 126,471 121,055 120,028 117,406Cash and cash equivalents 125,098 76,383 68,617 90,641 86,011Restricted cash 28,872 36,993 44,191 56,704 26,884Tenant receivables 10,485 10,124 9,279 10,627 10,548Deferred rent 280,570 267,954 257,427 243,459 234,124Deferred leasing and financing costs 234,093 222,343 210,709 199,576 201,798Investments 353,465 330,570 360,614 283,062 236,389Other assets 121,403 138,768 131,179 133,093 114,266Total assets $ 8,911,120 $ 8,737,344 $ 8,524,891 $ 8,405,221 $ 8,136,036

Liabilities, Noncontrolling Interests, and EquitySecured notes payable $ 818,217 $ 773,619 $ 771,435 $ 760,476 $ 652,209Unsecured senior notes payable 2,046,578 1,747,613 1,747,531 1,747,450 1,747,370Unsecured senior line of credit 151,000 843,000 624,000 421,000 304,000Unsecured senior bank term loans 950,000 950,000 950,000 975,000 975,000Accounts payable, accrued expenses, and tenant security deposits 589,356 586,594 531,612 645,619 489,085Dividends payable 62,005 61,340 61,194 58,824 58,814Total liabilities 4,617,156 4,962,166 4,685,772 4,608,369 4,226,478

Commitments and contingencies

Redeemable noncontrolling interests 14,218 14,218 14,248 14,282 14,315

Alexandria Real Estate Equities, Inc.’s stockholders’ equity:Series D cumulative convertible preferred stock 237,163 237,163 237,163 237,163 237,163Series E cumulative redeemable preferred stock 130,000 130,000 130,000 130,000 130,000Common stock 725 718 717 716 715Additional paid-in capital 3,558,008 3,356,043 3,371,016 3,383,456 3,461,189Accumulated other comprehensive income (loss) 49,191 35,238 83,980 29,213 (628)

Alexandria’s stockholders’ equity 3,975,087 3,759,162 3,822,876 3,780,548 3,828,439Noncontrolling interests 304,659 1,798 1,995 2,022 66,804Total equity 4,279,746 3,760,960 3,824,871 3,782,570 3,895,243Total liabilities, noncontrolling interests, and equity $ 8,911,120 $ 8,737,344 $ 8,524,891 $ 8,405,221 $ 8,136,036

Funds From Operations and Adjusted Funds From OperationsDecember 31, 2015

(In thousands)


The following table presents a reconciliation of net income (loss) attributable to Alexandria’s common stockholders – basic, the most directly comparable financial measure presented in accordance with generally accepted accounting principles (“GAAP”), to FFO attributable to Alexandria’s common stockholders – basic and diluted, FFO attributable to Alexandria’s common stockholders – diluted, as adjusted, and adjusted funds from operations (“AFFO”) attributable to Alexandria’s common stockholders – diluted. Quarterly amounts allocated to unvested restricted stock awards may not sum to annual amounts due to differences in the weighted-average share calculation of each period.

Three Months Ended Year Ended12/31/15 9/30/15 6/30/15 3/31/15 12/31/14 12/31/15 12/31/14

Net income (loss) attributable to Alexandria’s common stockholders $ 35,131 $ 32,659 $ 31,291 $ 17,786 $ (16,154) $ 116,867 $ 72,113Depreciation and amortization 72,528 68,398 62,523 59,202 58,302 262,651 224,425Impairment of real estate – rental properties 8,740 (1) — — 14,510 26,975 23,250 26,975Gain on sales of real estate – rental properties (2) (12,426) — — — (1,838) (12,426) (1,838)Gain on sales of real estate – land parcels — — — — (5,598) — (6,403)Allocation to unvested restricted stock awards (522) (698) (381) (166) (212) (1,758) (690)

FFO attributable to Alexandria’s common stockholders – basic and diluted (3) 103,451 100,359 93,433 91,332 61,475 388,584 314,582

Investment income (4) (7,731) (5,378) — — — (13,109) —Impairment of real estate – land parcels — — — — 24,700 — 24,700Loss on early extinguishment of debt — — 189 — — 189 525Preferred stock redemption charge — — — — 1,989 — 1,989Allocation to unvested restricted stock awards 85 67 (2) — (259) 110 (226)

FFO attributable to Alexandria’s common stockholders – diluted, as adjusted 95,805 95,048 93,620 91,332 87,905 375,774 341,570

Non-revenue-enhancing capital expenditures: Building improvements (2,025) (2,404) (2,743) (2,278) (1,989) (9,450) (7,429)Tenant improvements and leasing commissions (4,436) (5,499) (6,429) (5,775) (5,499) (22,139) (15,179)

Straight-line rent revenue (13,517) (12,006) (14,159) (10,697) (10,023) (50,379) (45,534)Straight-line rent expense on ground leases 862 (1,245) 510 363 657 490 2,788Amortization of acquired below-market leases (997) (3,182) (1,006) (933) (654) (6,118) (2,845)Amortization of loan fees 2,689 2,657 2,921 2,835 2,822 11,102 10,912Amortization of debt (premiums) discounts (90) (100) (100) (82) 17 (372) 117Stock compensation expense 4,590 5,178 4,054 3,690 4,624 17,512 13,996Allocation to unvested restricted stock awards 141 207 152 118 98 619 359

AFFO attributable to Alexandria’s common stockholders – diluted $ 83,022 $ 78,654 $ 76,820 $ 78,573 $ 77,958 $ 317,039 $ 298,755

(1) Represents an impairment charge related to 16020 Industrial Drive, a 71,000 RSF, R&D/warehouse building in Maryland. We expect to complete the sale of the asset in 2016.(2) Gain on sales of real estate – rental properties recognized during 4Q14 is classified in (loss) income from discontinued operations in the consolidated statements of income.(3) Calculated in accordance with standards established by the Advisory Board of Governors of the National Association of Real Estate Investment Trusts (the “NAREIT Board of Governors”) in its April 2002 White Paper and

related implementation guidance.(4) Includes gross investment gains of $12.7 million and $8.7 million for 4Q15 and 3Q15, respectively, primarily from the sale of two public securities in each of 4Q15 and 3Q15.

Funds From Operations Per Share and Adjusted Funds From Operations Per ShareDecember 31, 2015

(In thousands, except per share amounts)


The following table presents a reconciliation of earnings per share attributable to Alexandria’s common stockholders – basic, the most directly comparable financial measure presented in accordance with GAAP, to FFO per share attributable to Alexandria’s common stockholders – diluted, FFO per share attributable to Alexandria’s common stockholders – diluted, as adjusted, and AFFO per share attributable to Alexandria’s common stockholders – diluted. For the computation of the weighted-average shares used to compute the per share information, refer to the “Definitions and Reconciliations” section in our supplemental information. Amounts allocable to unvested restricted stock awards are not material and are not presented separately within the table below. Per share amounts may not add due to rounding.

Three Months Ended Year Ended 12/31/15 9/30/15 6/30/15 3/31/15 12/31/14 12/31/15 12/31/14EPS attributable to Alexandria’s common stockholders –

basic and diluted $ 0.49 $ 0.46 $ 0.44 $ 0.25 $ (0.23) $ 1.63 $ 1.01Depreciation and amortization 1.00 0.95 0.87 0.83 0.82 3.64 3.15Impairment of real estate – rental properties 0.12 — — 0.20 0.38 0.33 0.38Gain on sales of real estate – rental properties (0.17) — — — (0.03) (0.17) (0.03)Gain on sales of real estate – land parcels — — — — (0.08) — (0.09)

FFO per share attributable to Alexandria’s common stockholders – basic and diluted (1) 1.44 1.40 1.31 1.28 0.86 5.43 4.42

Investment income (0.11) (0.08) — — — (0.18) —Impairment of real estate – land parcels — — — — 0.34 — 0.34Loss on early extinguishment of debt — — — — — — 0.01Preferred stock redemption charge — — — — 0.03 — 0.03

FFO per share attributable to Alexandria’s common stockholders – diluted, as adjusted 1.33 1.33 1.31 1.28 1.23 5.25 4.80

Non-revenue-enhancing capital expenditures:Building improvements (0.03) (0.03) (0.04) (0.03) (0.03) (0.13) (0.10)Tenant improvements and leasing commissions (0.06) (0.08) (0.09) (0.08) (0.08) (0.31) (0.20)

Straight-line rent revenue (0.19) (0.17) (0.20) (0.15) (0.14) (0.71) (0.64)Straight-line rent expense on ground leases 0.01 (0.02) 0.01 0.01 0.01 0.01 0.04Amortization of acquired below-market leases (0.01) (0.04) (0.01) (0.01) (0.01) (0.09) (0.04)Amortization of loan fees 0.04 0.04 0.04 0.03 0.05 0.16 0.14Stock compensation expense 0.07 0.07 0.06 0.05 0.06 0.25 0.20

AFFO per share attributable to Alexandria’s common stockholders – diluted $ 1.16 $ 1.10 $ 1.08 $ 1.10 $ 1.09 $ 4.43 $ 4.20

Weighted-average shares of common stock outstanding for calculating FFO, FFO, asadjusted, and AFFO per share attributable to Alexandria’s common stockholders –basic and diluted 71,833 71,500 71,412 71,366 71,314 71,529 71,170

(1) Calculated in accordance with standards established by the NAREIT Board of Governors in its April 2002 White Paper and related implementation guidance.

SUPPLEMENTALINFORMATION

Company ProfileDecember 31, 2015


Alexandria Real Estate Equities, Inc. (NYSE:ARE) is the largest and leading urban office REIT uniquely focused on collaborative science and technology campuses in AAA innovation cluster locations with a total market capitalization of $10.9 billion as of December 31, 2015, and an asset base of 32.0 million square feet, including 20.1 million RSF of operating properties and development and redevelopment projects (under construction or pre-construction), as well as an additional 11.9 million square feet of future ground-up development projects. Alexandria pioneered this niche in 1994 and has since established a dominant market presence in key locations, including Greater Boston, San Francisco, New York City, San Diego, Seattle, Maryland, and Research Triangle Park. Alexandria has a longstanding and proven track record of developing Class A assets clustered in urban science and technology campuses that provide its innovative tenants with highly dynamic and collaborative environments that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. We believe these advantages result in higher occupancy levels, longer lease terms, higher rental income, higher returns, and greater long-term asset value. For additional information on Alexandria, please visit www.are.com.

Tenant base

Alexandria is known for its high-quality and diverse tenant base, with approximately 54% of total annualized base rent as of December 31, 2015, generated from investment-grade tenants – a REIT industry-leading percentage. The impressive quality, diversity, breadth, and depth of our significant relationships with our tenants provide Alexandria with high-quality and stable cash flows. Alexandria’s underwriting skills and long-term industry relationships positively distinguish us from all other publicly traded REITs and real estate companies.

Executive/senior management team

Alexandria’s executive and senior management team has unique experience and expertise in creating highly dynamic and collaborative campuses in key urban science and technology cluster locations that inspire innovation. From the development of high-quality, sustainable real estate, to the ongoing cultivation of collaborative environments with unique amenities and events, the Alexandria team has a first-in-class reputation of excellence in its niche. Our sophisticated management team also includes regional market directors with leading reputations and longstanding relationships within the science and technology communities in their respective urban innovation clusters. We believe that our unparalleled expertise, experience, reputation, and key relationships with the real estate, science, and technology industries provide Alexandria significant competitive advantages in attracting new business opportunities.

Alexandria’s executive/senior management team, consisting of 22 individuals, averages more than 25 years of real estate experience, including more than 12 years with Alexandria.

EXECUTIVE MANAGEMENT TEAM

Joel S. MarcusChairman,Chief Executive Officer & Founder

Dean A. ShigenagaExecutive Vice President,Chief Financial Officer & Treasurer

Thomas J. AndrewsExecutive Vice President –Regional Market Director – Greater Boston

Jennifer J. BanksExecutive Vice President – General Counsel & Corporate Secretary

Vincent R. CiruzziChief Development Officer

Peter M. MogliaChief Investment Officer

Stephen A. RichardsonChief Operating Officer &Regional Market Director – San Francisco

Daniel J. RyanExecutive Vice President –Regional Market Director – San Diego & Strategic Operations

NAV, FFO, and Common Stock Dividends Per ShareDecember 31, 2015


Growth in NAV Per Share (1) Growth in FFO Per Share (2)Growth in Common Stock

Dividends Per Share

(1) Based upon Real Estate Securities Monthly by Green Street Advisors Inc.(2) 2015 FFO per share, as adjusted, excludes gross investment gains of $12.7 million and $8.7 million for 4Q15 and 3Q15, respectively, primarily from the sale of two public securities in each of 4Q15 and 3Q15.

High-Quality, Diversified, and Innovative TenantsDecember 31, 2015


Increasing Cash Flows from Innovative, Diversified, andHigh-Quality Tenants

Total ABR from Investment-Grade Tenants Diverse Tenant Base by ABR

54%Top 20 ABR from Investment-Grade Tenants

81%Solid Lease Duration (2)

8.3 Years(1) Office and tech space compose 2.5% and 0.7% of ABR, respectively.(2) For top 20 tenants, representing 49.4% of total ABR.

Class A Assets in AAA LocationsDecember 31, 2015


High-Quality Cash Flows from Class A Assets in AAA Locations

Focus in Key Locations

Class A Assets inAAA Locations

75%of ARE’s Total ABR

% of ARE’s Total ABR

Solid OccupancyDecember 31, 2015


Consistent and Solid Demand for Class A Assets in AAA LocationsDrives Solid Occupancy

Occupancy of Operating PropertiesAcross Key Locations

Solid Occupancy (1)

95%Over 10 Years

(1) Average occupancy of operating properties in North America as of December 31 for the last 10 years.

Investor InformationDecember 31, 2015


Corporate Headquarters New York Stock Exchange Trading Symbols Information Requests385 East Colorado Boulevard, Suite 299 Common stock: ARE Phone: (626) 396-4828Pasadena, California 91101 Series D preferred stock: ARE PRD E-mail: [email protected]

Series E preferred stock: ARE PRE Web: www.are.com

Equity research coverage

Alexandria is currently covered by the following research analysts. This list may not be complete and is subject to change as firms initiate or discontinue coverage of our company. Pleasenote that any opinions, estimates, or forecasts regarding our historical or predicted performance made by these analysts are theirs alone and do not represent opinions, estimates, or forecasts ofAlexandria or its management. Alexandria does not by its reference or distribution of the information below imply its endorsement of or concurrence with any opinions, estimates, or forecasts ofthese analysts. Interested persons may obtain copies of analysts’ reports on their own as we do not distribute these reports. Several of these firms may from time-to-time own our stock and/or holdother long or short positions in our stock, and may provide compensated services to us.

Bank of America Merrill Lynch Evercore ISI Mitsubishi UFJ Securities (USA), Inc. Robert W. Baird & Co., IncorporatedJamie Feldman / Jeffrey Spector Sheila McGrath / Nathan Crossett Karin Ford David Rodgers / Richard Schiller(646) 855-5808 / (646) 855-1363 (212) 497-0882 / (212) 497-0870 (212) 405-7349 (216) 737-7341 / (312) 609-5485

Barclays Capital Inc. Green Street Advisors, Inc. Mizuho Securities USA Inc. Standard & Poor’sRoss Smotrich Michael Knott / Kevin Tyler Richard Anderson / Jieren Huang Cathy Seifert(212) 526-2306 (949) 640-8780 / (949) 640-8780 (212) 205-8445 / (201) 626-1085 (212) 438-9545

Citigroup Global Markets Inc. JMP Securities – JMP Group, Inc. RBC Capital Markets UBS Securities LLCMichael Bilerman / Emmanuel Korchman Peter Martin / Aaron Hecht Michael Carroll / Rich Moore Ross Nussbaum / Nick Yulico(212) 816-1383 / (212) 816-1382 (415) 835-8904 / (415) 835-3963 (440) 715-2649 / (440) 715-2646 (212) 713-2484 / (212) 713-3402

Cowen and Company, LLC J.P. Morgan Securities LLCJames Sullivan / Tom Catherwood Anthony Paolone / Gene Nusinzon(646) 562-1380 / (646) 562-1382 (212) 622-6682 / (212) 622-1041

Rating agencies

Moody’s Investors Service Rating Standard & Poor’s RatingPhilip Kibel / Merrie Frankel Baa2 Fernanda Hernandez / Anita Ogbara BBB-(212) 553-4569 / (212) 553-3652 Stable Outlook (212) 438-1347 / (212) 438-5077 Positive Outlook

Financial and Asset Base HighlightsDecember 31, 2015

(Dollars in thousands, except for per share amounts)


Three Months Ended (unless stated otherwise)12/31/15 9/30/15 6/30/15 3/31/15 12/31/14

Selected financial data from consolidated financial statements and related informationTotal revenues $ 223,955 $ 218,610 $ 204,156 $ 196,753 $ 188,674General and administrative expense as a percentage of total assets – trailing 12 months 0.7% 0.7% 0.7% 0.7% 0.7%General and administrative expense as a percentage of total revenues – trailing 12 months 7.1% 7.2% 7.2% 7.3% 7.4%Operating margins 69% 69% 70% 69% 70%Capitalized interest $ 8,696 $ 8,436 $ 8,437 $ 10,971 $ 11,665Weighted-average interest rate for capitalization of interest during period 3.37% 3.34% 3.45% 3.54% 3.69%

Gross investments in real estate $ 8,945,261 $ 8,787,478 $ 8,526,845 $ 8,421,861 $ 8,228,855Investments in unconsolidated real estate joint ventures $ 127,212 $ 126,471 $ 121,055 $ 120,028 $ 117,406Total assets $ 8,911,120 $ 8,737,344 $ 8,524,891 $ 8,405,221 $ 8,136,036Gross assets $ 10,226,459 $ 9,997,084 $ 9,729,916 $ 9,559,051 $ 9,256,281Total unsecured debt $ 3,147,578 $ 3,540,613 $ 3,321,531 $ 3,143,450 $ 3,026,370Total debt $ 3,965,795 $ 4,314,232 $ 4,092,966 $ 3,903,926 $ 3,678,579Total liabilities $ 4,617,156 $ 4,962,166 $ 4,685,772 $ 4,608,369 $ 4,226,478

Closing stock price $ 90.36 $ 84.67 $ 87.46 $ 98.04 $ 88.74Dividend per share – quarter/annualized $0.77/$3.08 $0.77/$3.08 $0.77/$3.08 $0.74/$2.96 $0.74/$2.96Dividend payout ratio for the quarter 58% 58% 59% 58% 60%Dividend yield – annualized 3.4% 3.6% 3.5% 3.0% 3.3%Total equity capitalization $ 6,949,924 $ 6,446,634 $ 6,640,810 $ 7,386,128 $ 6,713,547Total market capitalization $ 10,915,719 $ 10,760,866 $ 10,733,776 $ 11,290,054 $ 10,392,126Common shares outstanding (in thousands) 72,549 71,791 71,689 71,545 71,464

Net income (loss) attributable to Alexandria’s common stockholders $ 35,131 $ 32,659 $ 31,291 $ 17,786 $ (16,154)FFO attributable to Alexandria’s common stockholders – basic and diluted $ 103,451 $ 100,359 $ 93,433 $ 91,332 $ 61,475FFO attributable to Alexandria’s common stockholders – diluted, as adjusted $ 95,805 $ 95,048 $ 93,620 $ 91,332 $ 87,905AFFO attributable to Alexandria’s common stockholders – diluted $ 83,022 $ 78,654 $ 76,820 $ 78,573 $ 77,958

Earnings per share attributable to Alexandria’s common stockholders – basic and diluted $ 0.49 $ 0.46 $ 0.44 $ 0.25 $ (0.23)FFO per share attributable to Alexandria’s common stockholders – diluted $ 1.44 $ 1.40 $ 1.31 $ 1.28 $ 0.86FFO per share attributable to Alexandria’s common stockholders – diluted, as adjusted $ 1.33 $ 1.33 $ 1.31 $ 1.28 $ 1.23AFFO per share attributable to Alexandria’s common stockholders – diluted $ 1.16 $ 1.10 $ 1.08 $ 1.10 $ 1.09

Financial and Asset Base Highlights (continued)December 31, 2015

(Dollars in thousands, except for per share and ABR per occupied RSF amounts)


Three Months Ended (unless stated otherwise)12/31/15 9/30/15 6/30/15 3/31/15 12/31/14

Operating statistics and related informationNumber of properties 199 198 194 193 193Rentable square feet (including development and redevelopment projects under construction) 20,073,784 19,943,739 18,817,923 18,527,998 18,729,282Total square footage (including future value-creation projects square feet) 32,039,031 31,471,007 31,071,674 30,654,286 31,538,470ABR per occupied RSF – North America $ 41.17 $ 41.03 $ 40.20 $ 40.14 $ 38.68Occupancy of operating properties – North America 97.2% 96.2% 95.9% 96.8% 97.0%Occupancy of operating and redevelopment properties – North America 93.7% 93.0% 95.9% 95.9% 96.1%

Total leasing activity – RSF 1,012,238 1,021,756 1,915,379 1,022,669 581,660Lease renewals and re-leasing of space – change in average new rental rates over expiring rates:

Rental rate increases 19.8% 17.5% 14.5% 30.8% 10.1%Rental rate increases (cash basis) 7.3% 8.8% 7.0% 18.5% 2.4%RSF (1) 480,963 456,602 783,042 489,286 318,434

Certain non-GAAP and credit metric informationSame property – percentage change over comparable quarter from prior year:

NOI increase 1.3% 1.1% 0.5% 2.3% 3.6%NOI increase (cash basis) 2.0% 4.8% 4.7% 7.8% 6.7%

Adjusted EBITDA margins 65% 65% 65% 64% 65%Adjusted EBITDA – quarter annualized $ 586,120 $ 570,352 $ 532,904 $ 507,088 $ 493,432Adjusted EBITDA – trailing 12 months $ 549,116 $ 525,944 $ 501,827 $ 481,743 $ 468,492Net debt $ 3,857,727 $ 4,241,840 $ 4,023,048 $ 3,797,173 $ 3,565,684

Net debt to Adjusted EBITDA – quarter annualized 6.6x 7.4x 7.5x 7.5x 7.2xNet debt to Adjusted EBITDA – trailing 12 months 7.0x 8.1x 8.0x 7.9x 7.6xFixed charge coverage ratio – quarter annualized 3.6x 3.5x 3.4x 3.3x 3.3xFixed charge coverage ratio – trailing 12 months 3.4x 3.4x 3.3x 3.3x 3.3xUnencumbered NOI as a percentage of total NOI 81% 79% 78% 82% 84%

(1) Included in total leasing activity immediately above.

Key Operating MetricsDecember 31, 2015


Favorable Lease Structure Same Property NOI Increase

Percentage oftriple net leases 96%

Stable cash flows

Percentage of leasescontaining annualrent escalations 95%

Increasing cash flowsPercentage of leasesproviding forthe recapture ofcapital expenditures 94%

Lower capex burden

Adjusted EBITDA Margin (2)Rental Rate Increases:

Renewed/Re-leased Space

65%(1) Same property NOI growth and same property NOI growth (cash basis) for 2015 was impacted by free rent provided to our tenant at 3115 Merryfield Row as part of a relocation in 2015 to provide space to Vertex Pharmaceuticals Incorporated and a

favorable insurance settlement in 4Q14 related to our Superstorm Sandy insurance claim at 450 East 29th Street. Excluding these items, same property NOI growth and same property NOI growth (cash basis) would have been 1.5% and 5.4% for 2015, respectively.

(2) Represents the three months ended December 31, 2015, annualized.

Same Property PerformanceDecember 31, 2015

(Dollars in thousands)


Same Property Financial Data 4Q15 2015 Same Property Statistical Data 4Q15 2015

Percentage change over comparable period from prior year: Number of same properties 166 164

NOI increase 1.3% (1) 1.3% (1) Rentable square feet 14,495,900 14,054,506

NOI increase (cash basis) 2.0% (1) 4.7% (1) Occupancy – current-period average 94.2% 95.7%

Operating margin 68% 69% Occupancy – same-period prior-year average 94.5% 95.9%

The tables below provide two alternative calculations of same property performance in comparison to our historical same property performance. Our reported same property performance is based upon a pool of operating assets and development and redevelopment projects recently placed into service to the extent that those assets were operating for the entirety of the comparable same property periods presented. The two alternative calculations presented below consist of (i) same property performance for the operating portfolio excluding assets that were recently developed or redeveloped, and (ii) the same property performance for the operating portfolio including those redevelopment projects that were either under construction or recently placed into service. Same property performance including redevelopment properties generally would have been higher than our method of reporting same property performance. Same property performance including redevelopment properties will, from time to time, have significant growth in NOI as a result of the completion of the conversion of non-laboratory space (with lower NOI) to office/laboratory space (with higher NOI) through redevelopment. We believe our method of reporting same property performance is a more useful presentation since it excludes the potential significant increases in performance as a result of completion of significant redevelopment projects.

NOI Included in All Comparative Periods

OperatingProperties

Recently Placed into Service Properties Under ConstructionSame Property Developments Redevelopments Development RedevelopmentAs reported Yes Yes (2) Yes (2) No No

Operating portfolio Yes No No No No

Including redevelopments Yes No Yes No Yes

Percentage change in same property NOI over preceding periodSame Property 2012 2013 2014 2015As reported (0.5)% 1.8% 4.5% 1.3%

Operating portfolio (1.4)% 1.7% 4.8% 1.1%

Including redevelopments 0.9% 8.4% 6.9% 3.1%

Percentage change in same property NOI over preceding period (cash basis)Same Property 2012 2013 2014 2015As reported 3.5% 5.4% 5.5% 4.7%

Operating portfolio 2.0% 4.4% 3.3% 4.2%

Including redevelopments 1.5% 9.6% 8.1% 5.8%

(1) Same property NOI growth and same property NOI growth (cash basis) for the three months and year ended December 31, 2015, were impacted by free rent provided at 3115 Merryfield Row as part of a relocation in 2015 to provide space to Vertex Pharmaceuticals Incorporated and a favorable insurance settlement in 4Q14 related to our Superstorm Sandy insurance claim at 450 East 29th Street. Excluding these items, same property NOI growth and same property NOI growth (cash basis) would have been 1.8% and 3.9%, respectively, for the three months ended December 31, 2015, and 1.5% and 5.4%, respectively, for the year ended December 31, 2015.

(2) Development and redevelopment projects recently placed into service are included in the same property data for each of the year-over-year comparison periods only if the property was operating during both entire same property periods. For example, projects completed during 2013 are included in 2015 versus 2014 same property performance (as a percentage change over 2014).

Same Property Performance (continued)December 31, 2015


Three Months Ended December 31, Year Ended December 31,2015 2014 $ Change % Change 2015 2014 $ Change % Change

Same properties $ 126,411 $ 124,835 $ 1,576 1.3% $ 482,120 $ 481,524 $ 596 0.1%Non-same properties 31,689 16,038 15,651 97.6 126,704 62,629 64,075 102.3

Total rental 158,100 140,873 17,227 12.2 608,824 544,153 64,671 11.9

Same properties 45,890 41,320 4,570 11.1 174,302 159,037 15,265 9.6Non-same properties 9,066 3,962 5,104 128.8 34,761 14,443 20,318 140.7

Total tenant recoveries 54,956 45,282 9,674 21.4 209,063 173,480 35,583 20.5

Same properties 161 78 83 106.4 496 340 156 45.9Non-same properties 10,738 2,441 8,297 339.9 25,091 8,904 16,187 181.8

Total other income 10,899 2,519 8,380 332.7 25,587 9,244 16,343 176.8


Total revenues 223,955 188,674 35,281 18.7 843,474 726,877 116,597 16.0


Total rental operations 68,913 56,881 12,032 21.2 261,232 219,164 42,068 19.2


Consolidated net operating income 155,042 131,793 23,249 17.6 582,242 507,713 74,529 14.7

Same properties — — — — — — — —Non-same properties (1,048) — (1,048) 100.0 (1,048) — (1,048) 100.0

Less: NOI of consolidated real estate JVs attributable to NCI (1,048) — (1,048) 100.0 (1,048) — (1,048) 100.0

Same properties — — — — — — — —Non-same properties 1,184 918 266 29.0 4,372 918 3,454 376.3

Our share of NOI from unconsolidated real estate JVs 1,184 918 266 29.0 4,372 918 3,454 376.3


Our share of total net operating income $ 155,178 $ 132,711 $ 22,467 16.9% $ 585,566 $ 508,631 $ 76,935 15.1%

Our share of NOI – same properties $ 117,297 $ 115,795 $ 1,502 1.3% (1) $ 450,173 $ 444,488 $ 5,685 1.3% (1)

Our share of straight-line rent revenue & amortization ofacquired below-market leases (4,134) (4,803) 669 (13.9) (13,626) (27,669) 14,043 (50.8)

Our share of NOI – same properties (cash basis) $ 113,163 $ 110,992 $ 2,171 2.0% (1) $ 436,547 $ 416,819 $ 19,728 4.7% (1)

(1) See footnote (1) on the prior page.

Leasing ActivityDecember 31, 2015


December 31, 2015 December 31, 2014Three Months Ended Year Ended Year Ended

(Dollars are per RSF)

Including Straight-line

Rent Cash Basis

IncludingStraight-line

Rent Cash Basis

Including Straight-line

Rent Cash BasisLeasing activity:Renewed/re-leased space (1)

Rental rate changes 19.8% 7.3% 19.6% 9.9% 13.3% 5.4%New rates $ 34.14 $ 34.55 $ 35.70 $ 35.97 $ 40.32 $ 40.73Expiring rates $ 28.50 $ 32.21 $ 29.84 $ 32.73 $ 35.60 $ 38.63Rentable square footage 480,963 2,209,893 1,447,516Number of leases 39 146 124Tenant improvements/leasing commissions $ 8.85 $ 10.02 $ 10.49Average lease terms 4.0 years 4.7 years 3.5 years

Developed/redeveloped/previously vacant space leasedNew rates $ 36.42 $ 35.34 $ 55.24 $ 50.65 $ 40.62 $ 36.50Rentable square footage 531,275 2,762,149 1,321,317Number of leases 20 72 66Tenant improvements/leasing commissions $ 22.12 $ 19.63 $ 14.96Average lease terms 10.8 years 11.9 years 11.5 years

Leasing activity summary (totals):New rates $ 35.34 $ 34.96 $ 46.55 $ 44.13 $ 40.46 $ 38.71Rentable square footage 1,012,238 4,972,042 (2) 2,768,833Number of leases 59 218 190Tenant improvements/leasing commissions $ 15.82 $ 15.36 $ 12.62Average lease terms 7.6 years 8.7 years 7.3 years

Lease expirations: (1)

Expiring rates $ 26.84 $ 30.22 $ 28.32 $ 30.80 $ 33.09 $ 35.79Rentable square footage 539,209 2,801,883 1,733,614Number of leases 49 197 151

Leasing activity includes 100% of results for properties managed by us.

(1) Excludes 16 month-to-month leases for 30,810 RSF and 20 month-to-month leases for 43,672 RSF as of December 31, 2015 and 2014, respectively.(2) During the year ended December 31, 2015, we granted tenant concessions/free rent averaging 2.7 months with respect to the 4,972,042 RSF leased.

Contractual Lease ExpirationsDecember 31, 2015


Year Number of Leases RSFPercentage ofOccupied RSF ABR (per RSF)

2016 78 (1) 1,210,775 (1) 7.6% $ 33.99

2017 82 1,345,183 8.4% $ 28.43

2018 86 1,829,666 11.5% $ 38.76

2019 64 1,357,144 8.5% $ 36.43

2020 67 1,563,968 9.8% $ 36.65

2021 50 1,499,668 9.4% $ 39.53

2022 31 1,007,418 6.3% $ 33.67

2023 24 1,276,036 8.0% $ 38.03

2024 16 838,176 5.3% $ 45.35

2025 18 677,330 4.2% $ 34.56

Thereafter 36 3,309,651 21.0% $ 48.21

2016 Contractual Lease Expirations ABR ofExpiring Leases

(per RSF)

2017 Contractual Lease Expirations ABR ofExpiringLeases

(per RSF)

LeasedNegotiating/Anticipating

Targeted forRedevelopment

RemainingExpiring Leases Total (1) Leased

Negotiating/Anticipating

Targeted forRedevelopment

RemainingExpiringLeases TotalMarket

Greater Boston 85,615 20,678 — 48,176 154,469 $ 45.57 — — — 344,703 344,703 $ 38.82San Francisco 33,795 12,979 — 73,505 120,279 31.31 — — — 215,503 215,503 34.19New York City — — — 14,456 14,456 N/A — — — 3,536 3,536 N/ASan Diego 204,678 (2) — — 369,035 (3) 573,713 33.15 — — — 218,251 218,251 28.60Seattle 2,468 — — 44,058 46,526 34.35 — 20,133 — 47,326 67,459 45.21Maryland 29,153 — — 102,614 131,767 26.02 — — — 101,228 101,228 20.36Research Triangle Park 32,008 10,381 — 74,355 116,744 26.48 — — — 230,961 230,961 14.12Non-cluster markets — 8,854 — — 8,854 14.80 — — — 43,045 43,045 20.33Asia — 35,335 — 8,632 43,967 14.14 39,676 56,800 — 24,021 120,497 15.24Total 387,717 88,227 — 734,831 1,210,775 $ 33.99 39,676 76,933 — 1,228,574 1,345,183 $ 28.43

Percentage of expiring leases 32% 7% —% 61% 100% 3% 6% —% 91% 100%

Lease expirations include 100% of the RSF for properties managed by us.

(1) Excludes 16 month-to-month leases for 30,810 RSF.(2) Includes 158,645 RSF at 3115/3215 Merryfield Row. Upon expiration of the existing leases in January and August 2016, we will commence development of a new two-building project aggregating 230,523 RSF, including a 170,523 RSF build-to-suit space

for Vertex Pharmaceuticals Incorporated at the ARE Spectrum campus.(3) Includes 125,409 RSF leased to Eli Lilly and Company at 10300 Campus Point Drive with a contractual expiration in 4Q16. This tenant will relocate and expand into 304,326 RSF at our recently acquired redevelopment project at 10290 Campus Point

Drive.

Top 20 TenantsDecember 31, 2015



81% of ABR from Investment-Grade Tenants (1)

Remaining Lease Term in Years (2)

Aggregate RSF

Investment-Grade Ratings

Tenant ABRPercentage of

Aggregate ABR Fitch Moody’s S&P1 Novartis AG 2.0 608,561 $ 31,736 5.1% AA Aa3 AA-2 ARIAD Pharmaceuticals, Inc. 14.3 386,111 (3) 29,994 4.8 — — —3 Illumina, Inc. 14.2 595,886 25,452 4.0 — — BBB4 New York University 14.5 209,224 20,354 3.2 — Aa3 AA-5 Eli Lilly and Company 7.2 287,527 19,309 3.1 A A2 AA-6 Amgen Inc. 7.3 473,369 17,521 2.8 BBB Baa1 A7 Roche 4.7 343,772 16,517 2.6 AA A1 AA8 Dana-Farber Cancer Institute, Inc. 14.5 203,090 15,038 2.4 — A1 —9 Celgene Corporation 6.2 373,797 15,028 2.4 — Baa2 BBB+10 United States Government 9.4 263,147 14,778 2.4 AAA Aaa AA+11 FibroGen, Inc. 7.9 234,249 14,278 2.3 — — —12 Biogen Inc. 12.4 313,872 13,735 2.2 — Baa1 A-13 Massachusetts Institute of Technology 4.1 233,582 12,409 2.0 — Aaa AAA14 GlaxoSmithKline plc 3.7 296,604 11,325 1.8 A+ A2 A+15 Bristol-Myers Squibb Company 3.2 251,316 10,743 1.7 A- A2 A+16 The Regents of the University of California 7.8 230,633 10,391 1.6 AA Aa2 AA17 The Scripps Research Institute 2.1 218,031 9,738 1.5 AA- Aa3 —18 Sanofi 5.6 179,697 8,105 1.3 AA- A1 AA19 Alnylam Pharmaceuticals, Inc. 5.8 129,424 7,314 1.2 — — —20 Sumitomo Dainippon Pharma Co., Ltd. 7.3 106,232 6,501 1.0 — — —

Total/weighted average 8.3 5,938,124 $ 310,266 49.4%

ABR and RSF amounts include 100% of the properties managed by us.

(1) Represents ABR from investment-grade rated tenants as a percentage of ABR from top 20 tenants.(2) Based on percentage of aggregate ABR in effect as of December 31, 2015.(3) In August 2015, ARIAD Pharmaceuticals, Inc. (“ARIAD”) entered into a sublease for 163,186 RSF at 75 Binney Street for an initial lease term of 10 years with IBM Watson Health, a digital health venture of the International Business

Machines Corporation (“IBM”). IBM holds investment-grade ratings of A+ (Fitch), Aa3 (Moody’s), and AA- (S&P) and has the option to extend the sublease term through the end of the ARIAD lease in March 2030, at 75/125 Binney Street.

Summary of Properties and OccupancyDecember 31, 2015

(Dollars in thousands, except per RSF amounts)


Summary of properties

RSF Number ofProperties

ABRMarket Operating Development Redevelopment Total % Total Total % of Total per RSFGreater Boston 4,534,155 1,115,900 59,000 5,709,055 29% 44 $ 221,245 35% $ 50.58San Francisco 2,786,476 872,980 — 3,659,456 18 29 121,705 20 43.68New York City 663,296 64,378 — 727,674 4 2 56,135 9 84.88San Diego 3,017,030 420,364 515,362 3,952,756 20 51 100,379 16 34.53Seattle 746,260 287,806 — 1,034,066 5 11 33,113 5 44.54Maryland 2,085,196 — — 2,085,196 10 28 50,114 8 25.02Research Triangle Park 1,043,211 — — 1,043,211 5 15 22,716 4 22.31Canada 322,967 — — 322,967 2 4 7,661 1 23.88Non-cluster markets 268,689 — — 268,689 1 6 5,614 1 26.13

North America 15,467,280 2,761,428 574,362 18,803,070 94 190 618,682 99 41.17Asia 1,199,714 — — 1,199,714 6 8 7,768 1 9.19

Subtotal 16,666,994 2,761,428 574,362 20,002,784 100 198 626,450 100 39.46Properties “held for sale” 71,000 — — 71,000 — 1 1,048 — 14.76

Total 16,737,994 2,761,428 574,362 20,073,784 100% 199 $ 627,498 100% $ 39.35

RSF, number of properties, and ABR amounts include 100% of the properties managed by us.

Summary of occupancy

Operating Properties Operating and Redevelopment PropertiesMarket 12/31/15 9/30/15 12/31/14 12/31/15 9/30/15 12/31/14Greater Boston 96.5 % (1) 95.7 % 98.8 % 95.2 % 94.4 % 95.9 %San Francisco 100.0 100.0 98.9 100.0 100.0 98.9New York City 99.7 99.6 99.4 99.7 99.6 99.4San Diego 96.4 94.9 96.5 82.3 82.4 95.5Seattle 99.6 98.6 94.8 99.6 98.6 94.8Maryland 96.0 95.6 92.5 96.0 95.6 92.5Research Triangle Park 97.6 91.6 99.1 97.6 91.6 99.1

Subtotal 97.4 96.3 97.2 93.8 93.0 96.2Canada 99.3 99.3 97.6 99.3 99.3 97.6Non-cluster markets 80.0 84.5 87.4 80.0 84.5 87.4

North America 97.2% 96.2% 97.0% 93.7% 93.0% 96.1%

Occupancy amounts include 100% of properties managed by us.

(1) The decline from 4Q14 is primarily driven by a 128,325 RSF full-building lease that expired at 19 Presidential Way in our Route 128 submarket. We have leased 68,031 RSF with delivery/occupancy scheduled for 1H16.

Property ListingDecember 31, 2015



Occupancy Percentage

RSF Number ofProperties ABR

Operating andRedevelopmentMarket / Submarket / Address Operating Development Redevelopment Total Operating

Greater BostonCambridge/Inner Suburbs

Alexandria Center® at Kendall Square50/60, 100, and 75/125 Binney Street, 161 and 215 First Street, 150 Second

Street, 300 Third Street, and 11 Hurley Street 1,056,522 961,960 59,000 2,077,482 9 $ 61,436 97.8 % 92.6 %225 Binney Street (consolidated joint venture – 30% ownership) 305,212 — — 305,212 1 13,278 100.0 100.0

Alexandria Technology Square® 1,181,635 — — 1,181,635 7 71,012 99.9 99.9100, 200, 300, 400, 500, 600, and 700 Technology Square

480/500 Arsenal Street 234,260 — — 234,260 2 8,880 100.0 100.0640 Memorial Drive 225,504 — — 225,504 1 13,717 100.0 100.0780/790 Memorial Drive 99,658 — — 99,658 2 6,787 100.0 100.0167 Sidney Street/99 Erie Street 54,549 — — 54,549 2 2,715 100.0 100.079/96 Thirteenth Street Charlestown Navy Yard 25,309 — — 25,309 1 620 100.0 100.0

Cambridge/Inner Suburbs 3,182,649 961,960 59,000 4,203,609 25 178,445 99.2 97.4Longwood Medical Area

360 Longwood Avenue (unconsolidated joint venture – 27.5% ownership) 259,859 153,940 — 413,799 1 19,010 100.0 100.0Route 128

Alexandria Park at 128 343,882 — — 343,882 8 9,452 98.1 98.13, 6, and 8 Preston Court; 29, 35, and 44 Hartwell Avenue;

35, 45, and 47 Wiggins Avenue; and 60 Westview Street19 Presidential Way 128,325 — — 128,325 1 — —

(1)—

225 Second Avenue 112,500 — — 112,500 1 4,019 100.0 100.0100 Beaver Street 82,330 — — 82,330 1 3,064 100.0 100.0285 Bear Hill Road 26,270 — — 26,270 1 926 100.0 100.0

Route 128 693,307 — — 693,307 12 17,461 80.6 80.6Route 495/Worcester

111/130 Forbes Boulevard 155,846 — — 155,846 2 1,415 100.0 100.020 Walkup Drive 91,045 — — 91,045 1 670 100.0 100.0306 Belmont Street and 350 Plantation Street 90,690 — — 90,690 2 1,479 100.0 100.030 Bearfoot Road 60,759 — — 60,759 1 2,765 100.0 100.0

Route 495/Worcester 398,340 — — 398,340 6 6,329 100.0 100.0Greater Boston 4,534,155 1,115,900 59,000 5,709,055 44 $ 221,245 96.5% 95.2%

RSF, ABR, and occupancy include 100% of properties managed by us.

(1) We have leased 68,031 RSF with delivery/occupancy scheduled for 1H16.

Property Listing (continued)December 31, 2015






San FranciscoMission Bay/SoMa

409/499 Illinois Street (consolidated joint venture – 60% ownership) 455,069 — — 455,069 2 $ 27,012 100.0 % 100.0 %1455/1515 Third Street (unconsolidated joint venture – 51% ownership) — 422,980 — 422,980 2 — — —510 Townsend Street — 300,000 — 300,000 1 — — —455 Mission Bay Boulevard South 210,398 — — 210,398 1 9,891 100.0 100.01500 Owens Street (consolidated joint venture – 50.1% ownership) 158,267 — — 158,267 1 7,065 100.0 100.01700 Owens Street 157,340 — — 157,340 1 10,131 100.0 100.0505 Brannan Street — 150,000 — 150,000 1 — — —

Mission Bay/SoMa 981,074 872,980 — 1,854,054 9 54,099 100.0 100.0South San Francisco

Alexandria Technology Center® – Gateway 448,175 — — 448,175 6 17,271 100.0 100.0600, 630, 650, 681, 901, and 951 Gateway Boulevard

249/259/269 East Grand Avenue 407,369 — — 407,369 3 16,573 100.0 100.0400/450 East Jamie Court 163,035 — — 163,035 2 6,028 100.0 100.0500 Forbes Boulevard 155,685 — — 155,685 1 5,540 100.0 100.07000 Shoreline Court 136,395 — — 136,395 1 4,411 100.0 100.0341/343 Oyster Point Boulevard 107,960 — — 107,960 2 3,311 100.0 100.0849/863 Mitten Road and 866 Malcolm Road 103,857 — — 103,857 1 2,866 100.0 100.0

South San Francisco 1,522,476 — — 1,522,476 16 56,000 100.0 100.0Palo Alto/Stanford Research Park

2425 Garcia Avenue and 2400/2450 Bayshore Parkway 99,208 — — 99,208 1 4,257 100.0 100.03165 Porter Drive 91,644 — — 91,644 1 3,885 100.0 100.03350 West Bayshore Road 60,000 — — 60,000 1 1,919 100.0 100.02625/2627/2631 Hanover Street 32,074 — — 32,074 1 1,545 100.0 100.0

Palo Alto/Stanford Research Park 282,926 — — 282,926 4 11,606 100.0 100.0San Francisco 2,786,476 872,980 — 3,659,456 29 $ 121,705 100.0% 100.0%

New York CityManhattan

Alexandria Center® for Life Science 663,296 64,378 — 727,674 2 $ 56,135 99.7 % 99.7 %430 and 450 East 29th Street

New York City 663,296 64,378 — 727,674 2 $ 56,135 99.7% 99.7%








San DiegoTorrey Pines

ARE Spectrum 261,583 63,000 — 324,583 4 $ 8,424 100.0 % 100.0 %3115/3215 Merryfield Row and 3013/3033 Science Park Road

ARE Nautilus 241,191 — — 241,191 4 7,883 90.3 90.33530/3550 John Hopkins Court and 3535/3565 General Atomics Court

ARE Sunrise 231,526 — — 231,526 3 8,845 100.0 100.010931, 10933, and 10975 North Torrey Pines Road,

3010 Science Park Road, and 10996 Torreyana Road3545 Cray Court 116,556 — — 116,556 1 4,827 100.0 100.011119 North Torrey Pines Road 72,506 — — 72,506 1 2,774 100.0 100.0

Torrey Pines 923,362 63,000 — 986,362 13 32,753 97.5 97.5University Town Center

5200 Illumina Way 497,078 295,609 — 792,687 6 19,522 100.0 100.0Alexandria Center® for Life Science at Campus Pointe 449,759 — 304,326 754,085 2 17,894 100.0 59.6

10290 and 10300 Campus Point DriveARE Towne Centre 140,398 — 162,156 302,554 4 1,913 76.4 35.4

9363, 9373, 9393, and 9625 Towne Centre DriveARE Esplanade 180,208 61,755 — 241,963 4 6,978 100.0 100.0

4755, 4757, and 4767 Nexus Center Drive, and 4796 Executive Drive9880 Campus Point Drive 71,510 — — 71,510 1 2,774 100.0 100.0

University Town Center 1,338,953 357,364 466,482 2,162,799 17 49,081 97.5 72.3Sorrento Mesa

5810/5820 and 6138/6146/6150 Nancy Ridge Drive 160,784 — — 160,784 3 4,023 100.0 100.0ARE Portola 105,812 — — 105,812 3 2,153 70.0 70.0

6175, 6225, and 6275 Nancy Ridge Drive10121/10151 Barnes Canyon Road 53,512 — 48,880 102,392 2 1,472 100.0 52.37330 Carroll Road 66,244 — — 66,244 1 2,239 88.7 88.75871 Oberlin Drive 33,817 — — 33,817 1 973 100.0 100.0

Sorrento Mesa 420,169 — 48,880 469,049 10 10,860 90.7 81.2Sorrento Valley

11025/11035/11045/11055/11065/11075 Roselle Street 121,655 — — 121,655 6 2,798 88.5 88.53985/4025/4031/4045 Sorrento Valley Boulevard 103,111 — — 103,111 4 2,392 100.0 100.0

Sorrento Valley 224,766 — — 224,766 10 5,190 93.7 93.7I-15 Corridor

13112 Evening Creek Drive 109,780 — — 109,780 1 2,495 100.0 100.0San Diego 3,017,030 420,364 515,362 3,952,756 51 $ 100,379 96.4% 82.3%








SeattleLake Union

400 Dexter Avenue North — 287,806 — 287,806 1 $ — — % — %1201/1208 Eastlake Avenue East 203,369 — — 203,369 2 8,748 100.0 100.01616 Eastlake Avenue East 168,708 — — 168,708 1 8,229 98.3 98.31551 Eastlake Avenue East 117,482 — — 117,482 1 4,209 100.0 100.0199 East Blaine Street 115,084 — — 115,084 1 6,165 100.0 100.0219 Terry Avenue North 30,705 — — 30,705 1 1,615 100.0 100.01600 Fairview Avenue East 27,991 — — 27,991 1 1,133 100.0 100.0

Lake Union 663,339 287,806 — 951,145 8 30,099 99.6 99.6Elliott Bay

3000/3018 Western Avenue 47,746 — — 47,746 1 1,839 100.0 100.0410 West Harrison/410 Elliott Avenue West 35,175 — — 35,175 2 1,175 100.0 100.0

Elliott Bay 82,921 — — 82,921 3 3,014 100.0 100.0Seattle 746,260 287,806 — 1,034,066 11 33,113 99.6 99.6

MarylandRockville

9800 Medical Center Drive 282,436 — — 282,436 4 12,445 100.0 100.01330 Piccard Drive 131,511 — — 131,511 1 3,121 100.0 100.01500/1550 East Gude Drive 90,489 — — 90,489 2 1,681 100.0 100.014920/15010 Broschart Road 86,703 — — 86,703 2 1,873 100.0 100.01405 Research Boulevard 71,669 — — 71,669 1 2,104 100.0 100.05 Research Place 63,852 — — 63,852 1 2,389 100.0 100.09920 Medical Center Drive 58,733 — — 58,733 1 455 100.0 100.05 Research Court 54,906 — — 54,906 1 — — —12301 Parklawn Drive 49,185 — — 49,185 1 1,169 100.0 100.0

Rockville 889,484 — — 889,484 14 25,237 93.8 93.8Gaithersburg

Alexandria Technology Center® – Gaithersburg I 377,401 — — 377,401 4 7,831 95.7 95.79 West Watkins Mill Road and 910, 930, and 940 Clopper Road

Alexandria Technology Center® – Gaithersburg II 237,137 — — 237,137 5 6,008 99.0 99.0708 Quince Orchard Road, 1300 Quince Orchard Boulevard, and 19, 20,

and 22 Firstfield Road401 Professional Drive 63,154 — — 63,154 1 1,160 85.8 85.8950 Wind River Lane 50,000 — — 50,000 1 1,082 100.0 100.0620 Professional Drive 27,950 — — 27,950 1 1,191 100.0 100.0

Gaithersburg 755,642 — — 755,642 12 17,272 96.3 96.3Beltsville

8000/9000/10000 Virginia Manor Road 191,884 — — 191,884 1 2,467 100.0 100.0Northern Virginia

14225 Newbrook Drive 248,186 — — 248,186 1 5,138 100.0 100.0Maryland 2,085,196 — — 2,085,196 28 $ 50,114 96.0% 96.0%








Research Triangle ParkResearch Triangle Park

Alexandria Technology Center® – Alston 186,870 — — 186,870 3 $ 3,513 99.5 % 99.5 %100, 800, and 801 Capitola Drive

108/110/112/114 TW Alexander Drive 158,417 — — 158,417 1 4,537 100.0 100.0Alexandria Innovation Center® – Research Triangle Park 135,677 — — 135,677 3 2,941 100.0 100.0

7010, 7020, and 7030 Kit Creek Road6 Davis Drive 100,000 — — 100,000 1 1,062 100.0 100.07 Triangle Drive 96,626 — — 96,626 1 3,156 100.0 100.0407 Davis Drive 81,956 — — 81,956 1 1,644 100.0 100.02525 East NC Highway 54 82,481 — — 82,481 1 1,238 70.8 70.8601 Keystone Park Drive 77,395 — — 77,395 1 1,211 100.0 100.06040 George Watts Hill Drive 61,547 — — 61,547 1 2,051 100.0 100.05 Triangle Drive 32,120 — — 32,120 1 824 100.0 100.06101 Quadrangle Drive 30,122 — — 30,122 1 539 100.0 100.0Research Triangle Park 1,043,211 — — 1,043,211 15 22,716 97.6 97.6

Canada 322,967 — — 322,967 4 7,661 99.3 99.3

Non-cluster markets 268,689 — — 268,689 6 5,614 80.0 80.0

North America 15,467,280 2,761,428 574,362 18,803,070 190 618,682 97.2% 93.7%

AsiaChina 634,328 — — 634,328 2 2,059 73.9 % 73.9 %India 565,386 — — 565,386 6 5,709 66.7 66.7Asia 1,199,714 — — 1,199,714 8 7,768 70.5% 70.5%

Subtotal 16,666,994 2,761,428 574,362 20,002,784 198 626,450

Properties “held for sale”16020 Industrial Drive 71,000 — — 71,000 1 1,048Properties “held for sale” 71,000 — — 71,000 1 1,048

Total 16,737,994 2,761,428 574,362 20,073,784 199 $ 627,498


Key Real Estate MetricsDecember 31, 2015


Incremental Annual NOI From Development and Redevelopment Projects

2016 Deliveries

2017 & 2018 Deliveries

(1) Represents incremental annual NOI upon stabilization of our development and redevelopment projects, including our share of real estate joint venture development projects. Excludes NOI related to spaces delivered and in service prior to December 31, 2015.

Key Real Estate MetricsDecember 31, 2015


2016 Disciplined Allocation of Capital (1)15% of Gross Investments in Real Estate in

Value-Creation Pipeline

Pre-Leased (2) Percentage of Ground-Up Developments Since January 1, 2009

Ground-Up Developments Commenced &Delivered Since January 1, 2009

Single-Tenant

100%Pre-leased2.4M RSF

Multi-Tenant

38%Pre-leased2.5M RSF

Average Initial Stabilized Yield

8.0%

Average Initial Stabilized Yield

(Cash Basis)

7.6%(1) Includes projected construction and acquisitions for the year ending December 31, 2016. Refer to page 40 for additional details.(2) Represents average pre-leased percentage at the time development commenced.

LEED CertificationDecember 31, 2015


(1) Upon completion of 19 in-process LEED certification projects.

Investments in Real EstateDecember 31, 2015

(Dollars in thousands, except per square foot amounts)


Investments in Real Estate Square Feet

Consolidated

NoncontrollingShare of

ConsolidatedReal Estate

Joint Ventures

ARE Share ofUnconsolidated

Real EstateJoint Ventures

Total ARE ShareUnconsolidated

Real EstateJoint Ventures

at 100%Page Amount % Consolidated Total Per SF (1)

Rental properties:North America $ 7,582,888 $ (323,755) $ 69,889 $ 7,329,022 83% 15,278,421 259,859 15,538,280 $ 502Asia 160,906 — — 160,906 2 1,199,714 — 1,199,714 134

7,743,794 (323,755) 69,889 7,489,928 85 16,478,135 259,859 16,737,994 476

Development and redevelopment projects:

Projects to be delivered by 4Q16 556,220 — 35,125 591,345 7 1,319,545 153,940 1,473,485 458

Projects to be delivered by 2017 and 2018 361,486 (320) 65,390 426,556 5 1,439,325 422,980 1,862,305 261

Development and redevelopment projects 917,706 (320) 100,515 1,017,901 12 2,758,870 576,920 3,335,790 348

Rental properties and development/redevelopment projects 8,661,500 (324,075) 170,404 8,507,829 19,237,005 836,779 20,073,784 455

Future value-creation projects:North America 206,939 (12,185) — 194,754 2 5,545,540 — 5,545,540 37Asia 76,822 — — 76,822 1 6,419,707 — 6,419,707 12

283,761 (12,185) — 271,576 3 11,965,247 — 11,965,247 24

Value-creation pipeline 1,201,467 (12,505) 100,515 1,289,477 15

Gross investments in real estate 8,945,261 (336,260) 170,404 $ 8,779,405 100% 31,202,252 836,779 32,039,031 $ 294Less: accumulated depreciation (1,315,339) 21,257 (1,912)

Investments in real estate $ 7,629,922 $ (315,003) $ 168,492

Square foot amounts include 100% of properties managed by us.

(1) The per square foot amounts represent our investment in our real estate including our partners’ share of consolidated and unconsolidated real estate joint ventures, divided by 100% of the rentable or developable square feet of the respective property.

24

35

37

39

Development and Redevelopment Projects Placed into Service in 2015December 31, 2015



RSF in Service

% ofProject inService

Unlevered YieldsPlaced in Service 2015 Total Project

AverageCash

InitialStabilizedCash Basis

InitialStabilizedProperty/Market/Submarket Date

Prior to1/1/15

FirstQuarter

SecondQuarter

ThirdQuarter

FourthQuarter Total

Leased/Negotiating Investment

Consolidated development projects

75/125 Binney Street/Greater Boston/CambridgeMarch2015 — 388,270 — — — 388,270 100% 100% $ 361,000 (1) 9.3% (1) 8.4% (1) 8.3% (1)

430 East 29th Street/New York City/Manhattan Various 241,417 43,209 3,611 62,490 3,534 354,261 85% 98% $ 463,245 7.1% (2) 6.6% (2) 6.5% (2)

3013/3033 Science Park Road/San Diego/Torrey Pines Various 42,047 60,891 — — — 102,938 62% 81% $ 104,790 7.7% (2) 7.2% (2) 7.1% (2)

6040 George Watts Hill Drive/Research Triangle Park/Research Triangle Park

December2015 — — — — 61,547 61,547 100% 100% $ 25,700 (3) 8.2% (3) 7.4% (3) 8.2% (3)

Unconsolidated real estate joint venture development project360 Longwood Avenue/

Greater Boston/Longwood Medical Area (4) Various 155,524 2,107 51,997 50,231 — 259,859 63% 63% $ 108,965 (4) 8.2% (4) 7.3% (4) 7.8% (4)

Consolidated redevelopment projects

225 Second Avenue/Greater Boston/Route 128 May 2015 — — 112,500 — — 112,500 100% 100% $ 47,170 (5) 9.0% (2) 8.3% (2) 8.4% (5)

11055/11065/11075 Roselle Street/San Diego/Sorrento Valley June 2015 23,936 — 31,277 — — 55,213 100% 83% $ 18,190 8.1% (6) 7.9% (6) 8.0% (6)

Total 462,924 494,477 199,385 112,721 65,081 1,334,588

(1) Increased from our originally disclosed estimated yields of 9.1% for average cash yield, 8.0% for initial stabilized yield (cash basis), and 8.2% for initial stabilized yield. Increased from our originally disclosed cost of completion of $351.4 million.(2) Consistent with previously disclosed estimated yields.(3) Increased from our originally disclosed estimated yields of 8.1% for average cash yield, 7.3% for initial stabilized yield (cash basis), and 8.1% for initial stabilized yield. Decreased from our originally disclosed cost of completion of $25.8 million.(4) Decreased from our originally disclosed estimated yields of 9.3% for average cash yield, 8.3% for initial stabilized yield (cash basis), and 8.9% for initial stabilized yield. Represents ARE’s investment at completion related to its 27.5% interest in this

unconsolidated real estate joint venture. (5) Increased from our originally disclosed estimated yield of 8.3% for initial stabilized yield. Increased from our originally disclosed cost of completion of $46.7 million.(6) Increased from our originally disclosed estimated yields of 8.0% for average cash yield, 7.8% for initial stabilized yield (cash basis), and 7.9% for initial stabilized yield.

Visible Growth Pipeline: Highly Leased Projects to Be Placed into Service by 4Q16December 31, 2015



Dev/Redev

Project RSF Percentage Total Leased/Negotiating ProjectStart

OccupancyProperty/Market/Submarket In Service CIP Total Leased Negotiating RSF % Initial Stabilized

430 East 29th Street/New York City/Manhattan Dev 354,261 64,378 418,639 87% 11% 409,531 98 % 4Q12 4Q13 2Q165200 Illumina Way, Bldg 6/San Diego/University Town Center Dev — 295,609 295,609 100% —% 295,609 100 % 3Q14 3Q16 3Q1650/60 Binney Street/Greater Boston/Cambridge Dev — 530,477 530,477 98% —% 520,385 98 % 1Q15 4Q16 4Q16360 Longwood Avenue/Greater Boston/Longwood Medical Area Dev 259,859 153,940 413,799 63% —% 262,367 63 % 2Q12 3Q14 4Q163013/3033 Science Park Road/San Diego/Torrey Pines Dev 102,938 63,000 165,938 81% —% 135,002 81 % 2Q14 4Q14 4Q1610290 Campus Point Drive/San Diego/University Town Center Redev — 304,326 304,326 100% —% 304,326 100 % 3Q15 4Q16 4Q164796 Executive Drive/San Diego/University Town Center Dev — 61,755 61,755 100% —% 61,755 100 % 4Q15 4Q16 4Q16

Total/weighted average 717,058 1,473,485 2,190,543 89% 2% 1,988,975 91%

Our Share of Investment Unlevered Yields

Property/Market/Submarket

OurOwnership

Interest

Cost to CompleteAverage

Cash

InitialStabilized

(CashBasis)

InitialStabilizedIn Service CIP

ConstructionFinancing Other

Total atCompletion

430 East 29th Street/New York City/Manhattan 100% $ 376,235 $ 67,861 $ — $ 19,149 $ 463,245 7.1% 6.6% 6.5%5200 Illumina Way, Bldg 6/San Diego/University Town Center 100% — 44,712 — 25,188 69,900 8.6% 7.0% 8.4%50/60 Binney Street/Greater Boston/Cambridge 100% — 298,426 201,574 (1) — 500,000 8.1% 7.3% 7.4%360 Longwood Avenue/Greater Boston/Longwood Medical Area 27.5% 59,102 35,125 10,940 (2) 3,798 108,965 (3) 8.2% 7.3% (3) 7.8%3013/3033 Science Park Road/San Diego/Torrey Pines 100% 54,132 13,949 — 36,709 104,790 7.7% 7.2% 7.1%10290 Campus Point Drive/San Diego/University Town Center 100% — 121,114 — 119,886 241,000 7.6% 6.8% 7.0%4796 Executive Drive/San Diego/University Town Center 100% — 10,158 — 32,042 42,200 7.7% 6.8% 7.1%

Total/weighted average $ 489,469 $ 591,345 $ 212,514 $ 236,772 $ 1,530,100

(1) See page 53 for additional information related to our secured construction loan. (2) See page 47 for additional information related to the joint venture secured construction loan. (3) Our projected cost at completion and unlevered initial stabilized yield (cash basis) is based upon our share of the investment in real estate, including costs incurred directly by us outside of the real estate joint venture. Development management fees earned from

these development projects have been excluded from our estimate of unlevered yields. The RSF related to the project in the table above represents 100% of the project RSF.

Visible Growth Pipeline: Highly Leased Projects to Be Placed into Service by 4Q16December 31, 2015



430 East 29th Street 5200 Illumina Way, Building 6 50 Binney Street 60 Binney StreetNew York City/Manhattan San Diego/University Town Center Greater Boston/Cambridge Greater Boston/Cambridge

64,378 RSF 295,609 RSF 274,734 RSF 255,743 RSFRoche/New York University/Others Illumina, Inc. Sanofi Genzyme bluebird bio, Inc.

360 Longwood Avenue 3013/3033 Science Park Road 10290 Campus Point Drive 4796 Executive DriveGreater Boston/Longwood Medical Area San Diego/Torrey Pines San Diego/University Town Center San Diego/University Town Center

153,940 RSF 63,000 RSF 304,326 RSF 61,755 RSFDana-Farber Cancer Institute, Inc./

The Children’s Hospital CorporationCelgene Corporation/

The Medicines Company Eli Lilly and Company Otonomy, Inc.

Visible Growth Pipeline: Projects to Be Placed into Service in 2017 and 2018December 31, 2015



Dev/Redev

Project RSF Percentage Total Leased/Negotiating ProjectStart

OccupancyProperty/Market/Submarket In Service CIP Total Leased Negotiating RSF % Initial Stabilized

100 Binney Street/Greater Boston/Cambridge Dev — 431,483 431,483 48% 50% 423,875 98 % 3Q15 4Q17 2017510 Townsend Street/San Francisco/Mission Bay/SoMa Dev — 300,000 300,000 100% —% 300,000 100 % 3Q15 3Q17 2017505 Brannan Street, Phase I/San Francisco/Mission Bay/SoMa Dev — 150,000 150,000 100% —% 150,000 100 % 1Q16 2H17 20171455/1515 Third Street/San Francisco/Mission Bay/SoMa Dev — 422,980 422,980 100% —% 422,980 100 % 3Q14 2Q/3Q18 2018400 Dexter Avenue North/Seattle/Lake Union Dev — 287,806 287,806 56% 34% 259,594 90 % 2Q15 1Q17 (1) 201811 Hurley Street/Greater Boston/Cambridge Redev — 59,000 59,000 —% 100% 59,000 100 % 3Q15 1Q17 20179625 Towne Centre Drive/San Diego/University Town Center Redev — 162,156 162,156 —% —% — — % 3Q15 1Q17 201710151 Barnes Canyon Road/San Diego/Sorrento Mesa Redev — 48,880 48,880 —% —% — — % 4Q15 1H17 2017

Total/weighted average — 1,862,305 1,862,305 67% 20% 1,615,449 87%

Our Share of Investment Unlevered Yields

Property/Market/Submarket

OurOwnership

Interest

Cost to CompleteAverage

Cash

InitialStabilizedCash Basis

InitialStabilizedIn Service CIP

ConstructionFinancing Other

Total atCompletion

100 Binney Street/Greater Boston/Cambridge 100% $ — $ 175,101 $ — $ — $ TBD (2) (2) (2)

510 Townsend Street/San Francisco/Mission Bay/SoMa 100% — 67,198 — 170,802 238,000 7.9% 7.0% 7.2%505 Brannan Street, Phase I/San Francisco/Mission Bay/SoMa 99% — 25,438 — — TBD (2) (2) (2)

1455/1515 Third Street/San Francisco/Mission Bay/SoMa 51% 10,787 (3) 65,390 (3) — — TBD (2) (2) (2)

400 Dexter Avenue North/Seattle/Lake Union 100% — 54,607 — — TBD (2) (2) (2)

11 Hurley Street/Greater Boston/Cambridge 100% — 9,129 — — TBD (2) (2) (2)

9625 Towne Centre Drive/San Diego/University Town Center 100% — 23,095 — — TBD (2) (2) (2)

10151 Barnes Canyon Road/San Diego/Sorrento Mesa 100% — 6,598 — — TBD (2) (2) (2)

Total/weighted average $ 10,787 $ 426,556 $ — $ TBD $ TBD

(1) We expect to place into service 161,433 RSF, or 56% of the project, in 1Q17. (2) The design and budget of these projects are in process, and the estimated project costs with related yields will be disclosed in the future.(3) The in service and CIP costs are based on our share of the investment in real estate, including costs incurred directly by us outside of the joint venture. The RSF related to the project in the table above represents 100% of the project RSF.

Visible Growth Pipeline: Projects to Be Placed into Service in 2017 and 2018December 31, 2015



100 Binney Street 510 Townsend Street 505 Brannan Street, Phase I 1455/1515 Third StreetGreater Boston/Cambridge San Francisco/Mission Bay/SoMa San Francisco/Mission Bay/SoMa San Francisco/Mission Bay/SoMa

431,483 RSF 300,000 RSF 150,000 RSF 422,980 RSFBristol-Myers Squibb Company Stripe, Inc. Pinterest, Inc. Uber Technologies, Inc.

400 Dexter Avenue North 11 Hurley Street 9625 Towne Centre Drive 10151 Barnes CanyonSeattle/Lake Union Greater Boston/Cambridge San Diego/University Town Center San Diego/Sorrento Mesa

287,806 RSF 59,000 RSF 162,156 RSF 48,880 RSFJuno Therapeutics, Inc. Negotiating Marketing Marketing

Key Future ProjectsDecember 31, 2015


Property/Market/Submarket Square FeetAlexandria Technology Square®/Greater Boston/Cambridge 100,000505 Brannan Street, Phase II/San Francisco/Mission Bay/SoMa 165,000Grand Avenue/San Francisco/South San Francisco (1) 397,132560 Eccles Avenue/San Francisco/South San Francisco (2) 144,000East 29th Street/New York City/Manhattan 420,0005200 Illumina Way/San Diego/University Town Center 386,04410300 Campus Point Drive/San Diego/University Town Center 292,3871150/1165/1166 Eastlake Avenue East/Seattle/Lake Union 366,0001818 Fairview Avenue East/Seattle/Lake Union 188,4906 Davis Drive/Research Triangle Park/Research Triangle Park 1,000,000Other 2,086,487

Future value-creation projects 5,545,540

(1) Represents two additional land parcels located adjacent to/surrounding the recently developed 249/259/269 East Grand Avenue campus leased to Amgen Inc. in South San Francisco.(2) Represents an additional land parcel located near our 341/343 Oyster Point Boulevard properties and within walking distance of Roche’s campus in South San Francisco.

Projected Capital Allocation and Construction SpendingDecember 31, 2015



Capital AllocationProjected Construction and Acquisition Spending in 2016 (1)

Projected Construction Spending Year Ending December 31, 2016Development and redevelopment projects $ 761,000Generic laboratory infrastructure/building improvement projects 77,000Non-revenue-enhancing capital expenditures and tenant improvements 12,000

Total construction spending $ 850,000

Guidance range for the year ending December 31, 2016 $ 800,000 – 900,000

(1) Refer to 2016 guidance for uses of capital on page 3.

Historical Construction SpendingDecember 31, 2015



Actual Construction SpendingYear Ended

December 31, 2015Development and redevelopment projects $ 473,821Other building improvement projects (1) 89,342

Total construction costs 563,163Decrease in accrued construction 10,070

Total construction spending (cash basis) $ 573,233

Consolidated construction spending $ 564,206Contributions to unconsolidated real estate joint ventures 9,027

Total construction spending (cash basis) $ 573,233

(1) Includes revenue-enhancing projects and non-revenue-enhancing capital expenditures shown in the table below.

2015 Disciplined Allocation of Capital (1)

Non-Revenue-Enhancing Capital Expenditures, Tenant Improvements, and Leasing Costs (1)

Year Ended December 31, 2015 Recent Average Per RSF (2)Amount RSF Per RSF

Non-revenue-enhancing capital expenditures $ 9,450 16,582,818 $ 0.57 $ 0.34

Tenant improvements and leasing costs:Re-tenanted space $ 10,567 742,960 $ 14.22 $ 13.31Renewal space 11,572 1,466,933 7.89 6.60

Total tenant improvements and leasing costs/weighted average $ 22,139 2,209,893 $ 10.02 $ 8.31

(1) Excludes amounts that are recoverable from tenants, revenue-enhancing, or related to properties that have undergone redevelopment.(2) Represents the average of the five years ended December 31, 2015.

Pro Rata – Operating InformationDecember 31, 2015

(Dollars In thousands)


Three Months Ended December 31, 2015

Consolidated


Consolidated JVsOur Share of

Unconsolidated JVs Our Total ShareTotal revenues $ 223,955 $ (1,403) $ 2,012 $ 224,564Rental operations 68,913 (355) 828 69,386

155,042 (1,048) 1,184 155,178Expenses:General and administrative 15,102 (1) — 15,101Interest 28,230 — 703 28,933Depreciation and amortization 72,245 (372) 655 72,528Impairment on real estate 8,740 — — 8,740

124,317 (373) 1,358 125,302

Equity in loss from unconsolidated real estate joint ventures (174) — 174 —Gain on sales of real estate – rental properties 12,426 — — 12,426Net income 42,977 (675) — 42,302Net income attributable to noncontrolling interests (972) 675 — (297) (1)

Net income attributable to Alexandria Real Estate Equities, Inc. 42,005 — — 42,005Dividends on preferred stock (6,246) — — (6,246)Net income attributable to unvested restricted stock awards (628) — — (628)Net income attributable to Alexandria's common stockholders $ 35,131 $ — $ — $ 35,131

(1) Represents net income attributable to redeemable noncontrolling interests. These redeemable interests earn a fixed preferred return of 8.4% rather than a variable return based upon their ownership percentage of the joint venture. Consequently, these interests are excluded in our pro rata calculation.

Pro Rata – Balance Sheet InformationDecember 31, 2015



December 31, 2015

Consolidated


Consolidated JVsOur Share of

Unconsolidated JVs Our Total ShareInvestments in real estate $ 7,629,922 $ (315,003) $ 168,492 $ 7,483,411Investments in unconsolidated real estate joint ventures 127,212 — (127,212) —Cash and cash equivalents 125,098 (1,385) 4,209 127,922Other assets 1,028,888 (19,925) 7,638 1,016,601

Total assets $ 8,911,120 $ (336,313) $ 53,127 $ 8,627,934

Secured notes payable $ 818,217 $ — $ 48,726 $ 866,943Unsecured debt 3,147,578 — — 3,147,578Other liabilities 651,361 (17,436) 4,401 638,326

Total liabilities 4,617,156 (17,436) 53,127 4,652,847

Redeemable noncontrolling interests 14,218 (14,218) — —

Alexandria’s stockholders’ equity 3,975,087 — — 3,975,087Noncontrolling interests 304,659 (304,659) — —Total equity 4,279,746 (304,659) — 3,975,087

Total liabilities and equity $ 8,911,120 $ (336,313) $ 53,127 $ 8,627,934

Consolidated Joint Ventures – Operating InformationDecember 31, 2015



225 Binney Street (1) 1500 Owens Street (1) 409/499 Illinois Street (1) Various

Three Months Ended December 31, 2015Consolidated Real Estate Joint Ventures at 100% Total

Total revenues $ 672 $ 583 $ 1,439 $ 773 $ 3,467Rental operations 101 191 348 628 1,268

571 392 1,091 145 2,199Expenses:General and administrative — — 2 15 17Interest — — — — —Depreciation and amortization 168 133 403 348 1,052

Net income $ 403 $ 259 $ 686 $ (218) $ 1,130

NCI Share of Amounts Above70% 49.9% 40% Various (2) Total

Total revenues $ 471 $ 291 $ 575 $ 66 $ 1,403Rental operations 71 96 139 49 355

400 195 436 17 1,048Expenses:General and administrative — — 1 — 1Interest — — — — —Depreciation and amortization 118 66 161 27 372

Net income $ 282 $ 129 $ 274 $ (10) $ 675

(1) Noncontrolling interests in these real estate joint ventures were sold in December 2015. See page 48 for further details on the disposition of the noncontrolling interests for these properties.(2) Excludes net income attributable to redeemable noncontrolling interests, aggregating $297,000. These redeemable interests earn a fixed preferred return of 8.4% rather than a variable return based upon their ownership percentage of the joint

venture. Consequently, these interests are excluded in our pro rata calculation.

Consolidated Joint Ventures – Balance Sheet InformationDecember 31, 2015



225 Binney Street (1) 1500 Owens Street (1) 409/499 Illinois Street (1) Various

December 31, 2015Consolidated Real Estate Joint Ventures at 100% Total

Investments in real estate $ 163,359 $ 82,712 $ 362,403 $ 117,075 $ 725,549Cash and cash equivalents 1,247 16 797 3,691 5,751Other assets 6,877 6,382 24,374 10,274 47,907

Total assets $ 171,483 $ 89,110 $ 387,574 $ 131,040 $ 779,207

Secured notes payable $ — $ — $ — $ — $ —Other liabilities 2,752 9,704 26,210 8,046 46,712

Total liabilities 2,752 9,704 26,210 8,046 46,712

Redeemable noncontrolling interests — — — 14,218 (2) 14,218

Total equity 168,731 79,406 361,364 108,776 718,277Total liabilities and equity $ 171,483 $ 89,110 $ 387,574 $ 131,040 $ 779,207

NCI Share of Amounts Above70% 49.9% 40% Various Total

Investments in real estate $ 114,351 $ 41,274 $ 144,961 $ 14,417 $ 315,003Cash and cash equivalents 873 8 319 185 1,385Other assets 4,814 3,184 9,750 2,177 19,925

Total assets $ 120,038 $ 44,466 $ 155,030 $ 16,779 $ 336,313

Secured notes payable $ — $ — $ — $ — $ —Other liabilities 1,926 4,843 10,484 183 17,436

Total liabilities 1,926 4,843 10,484 183 17,436

Redeemable noncontrolling interests — — — 14,218 (2) 14,218

Total equity 118,112 39,623 144,546 2,378 304,659Total liabilities and equity $ 120,038 $ 44,466 $ 155,030 $ 16,779 $ 336,313

(1) Noncontrolling interests in these real estate joint ventures were sold in December 2015. See page 48 for further details on the disposition of the noncontrolling interests for these properties. (2) Represents redeemable noncontrolling interests, totaling approximately 37% ownership in one of our consolidated real estate joint ventures. Excluding this entity, the remaining real estate joint venture partners have approximately 2%

ownership in the various consolidated real estate joint ventures.

Unconsolidated Joint Ventures – Operating InformationDecember 31, 2015



360 Longwood Avenue 1455/1515 Third Street

Three Months Ended December 31, 2015Unconsolidated Real Estate JVs at 100% Total

Total revenue $ 6,526 $ 265 $ 6,791Rental operations 2,677 171 2,848

3,849 94 3,943Interest 2,550 — 2,550Depreciation and amortization 1,735 132 1,867

Net loss $ (436) $ (38) $ (474)

Our Share of Amounts Above27.5% 51% Total

Total revenue $ 1,876 (1) $ 136 $ 2,012Rental operations 737 91 828

1,139 45 1,184Interest 703 — 703Depreciation and amortization 587 (2) 68 (2) 655

Net loss $ (151) $ (23) $ (174)

(1) Includes development and property management fees earned by us.(2) Amounts include depreciation and amortization of costs incurred directly by us outside of the real estate joint ventures.

Unconsolidated Joint Ventures – Balance Sheet InformationDecember 31, 2015



360 Longwood Avenue 1455/1515 Third Street

December 31, 2015Unconsolidated Real Estate Joint Ventures at 100% Total

Investments in real estate $ 305,595 $ 139,875 $ 445,470Cash and cash equivalents 4,906 5,607 10,513Other assets 18,716 2,495 21,211

Total assets $ 329,217 $ 147,977 $ 477,194

Secured notes payable $ 177,186 (1) $ — $ 177,186Other liabilities 3,212 6,008 9,220

Total liabilities 180,398 6,008 186,406

Total equity 148,819 141,969 290,788Total liabilities and equity $ 329,217 $ 147,977 $ 477,194

Our Share of Amounts Above (2)

27.5% 51% TotalInvestments in real estate $ 92,675 $ 75,817 $ 168,492Cash and cash equivalents 1,349 2,860 4,209Other assets 6,145 1,493 7,638

Total assets $ 100,169 $ 80,170 $ 180,339

Secured notes payable $ 48,726 (1) $ — $ 48,726Other liabilities 1,265 3,136 4,401

Total liabilities 49,991 3,136 53,127

Total equity 50,178 77,034 127,212Total liabilities and equity $ 100,169 $ 80,170 $ 180,339

(1) Represents a non-recourse, secured construction loan with aggregate commitments of $213.2 million, of which $175.2 million bears interest at a fixed rate of 5.25% and $38.0 million bears interest at a floating rate of LIBOR+3.75%, with a floor of 5.25%. Borrowings under the floating rate tranche are subject to an interest rate cap on LIBOR of 3.50% and matures in April 2017. The maturity date of the loan is April 1, 2017, with two, one-year options to extend the stated maturity date to April 1, 2019, subject to certain conditions.

(2) Amounts include costs incurred directly by us outside of the real estate joint ventures.

DispositionsDecember 31, 2015



Property/Market/SubmarketDate

of SaleSquare

FeetInterest

Sold NOI (1)Cash

NOI (1)

CashCapitalization

Rate Sales Price (1)

SalesPrice

Per RSF661 University Avenue/Canada/Toronto 1/7/15 N/A 100% $ (1,363) $ (135) N/A $ 54,104 $ N/A270 Third Street/Greater Boston/Cambridge 6/25/15 N/A 100% — — N/A 25,477 N/A75/125 Shoreway Road/San Francisco/Palo Alto/Stanford Research Park (2) 11/17/15 82,874 100% 2,616 2,231 5.8% 38,500 4651500 Owens Street/San Francisco/Mission Bay/SoMa 12/15/15 158,267 49.9% 4,169 3,524 4.8% (3) 73,353 (6) 929225 Binney Street/Greater Boston/Cambridge 12/16/15 305,212 70% 9,320 8,650 4.5% (4) 190,110 (6) 890409/499 Illinois Street/San Francisco/Mission Bay/SoMa 12/17/15 455,069 40% 10,292 8,535 4.5% (5) 189,600 (6) 1,042Other Various 196,859 100% (595) (595) N/A 14,335 N/A

$ 24,439 $ 22,210 $ 585,479

(1) Cash NOI excludes straight-line rent and amortization of acquired below-market leases. For sales of less than 100% of the property, NOI, cash NOI, and sales price represent the proportional interest sold and the NOI amounts represent the annualized amounts for the quarter ended prior to the date of sale. Amounts exclude transaction and closing costs.

(2) Represents the sale of a Class B lab building located in our Palo Alto/Stanford Research Park submarket.(3) We acquired this land parcel and subsequently developed the property with an initial stabilized yield (cash basis) of 8.2%.(4) We acquired this land parcel and subsequently developed the property with an initial stabilized yield (cash basis) of 7.5%.(5) We acquired 409/499 Illinois Street, comprised at acquisition of one operating building and one partially complete building undergoing development. We completed 499 Illinois (development project) with an initial stabilized yield (cash basis) of

6.7%.(6) Aggregate proceeds of $453.1 million were received and accounted for as an equity financing transaction. The excess sales price over our cost basis, net of selling costs, of $141.9 million was recognized as an adjustment to additional paid in capital.

Non-Real Estate InvestmentsDecember 31, 2015



Public/Private Investment Mix(Cost)

Tenant/Non-Tenant Mix(Cost)

InvestmentType Cost

UnrealizedGains Total

Number of Investments

185Average Size of Investment

$1.3MPublic $ 20,022 $ 117,599 $ 137,621

Private 215,844 N/A 215,844

Total $ 235,866 $ 117,599 $ 353,465

Key Credit MetricsDecember 31, 2015


Net Debt to Adjusted EBITDA (1) Liquidity (2)

$2BAvailability under our $1.5 billion Unsecured Senior Line of Credit $ 1,349.0

Remaining construction loan commitments 349.4

“Available-for-sale” marketable equity securities 137.6

Cash and cash equivalents 125.1

$ 1,961.1

Fixed Charge Coverage Ratio (1) Unencumbered NOI (3)

81%

(1) Quarter annualized.(2) As of December 31, 2015.(3) For the three months ended December 31, 2015.

Summary of DebtDecember 31, 2015


Debt maturities chart(Dollars in millions)

(1) In January 2016, we repaid two secured notes payable aggregating $36.4 million with a weighted average effective interest rate of 5.28%.(2) We have a one-year option to extend the stated maturity date to August 23, 2018, subject to certain conditions.

Fixed-rate/hedged and unhedged variable-rate debt

(Dollars in thousands)Fixed-Rate/HedgedVariable-Rate Debt

UnhedgedVariable-Rate Debt

TotalConsolidated

Percentage of Total Debt

Weighted-AverageInterest Rate at

End of Period (1)

Weighted-AverageRemaining Term

(in years)Secured notes payable $ 400,235 $ 417,982 $ 818,217 20.6% 3.84% 2.7Unsecured senior notes payable 2,046,578 — 2,046,578 51.7 4.04 7.7$1.5 billion unsecured senior line of credit 100,000 51,000 151,000 3.8 1.62 3.02019 Unsecured Senior Bank Term Loan 600,000 — 600,000 15.1 1.71 3.02021 Unsecured Senior Bank Term Loan 350,000 — 350,000 8.8 1.52 5.0Total/weighted average $ 3,496,813 $ 468,982 $ 3,965,795 100.0% 3.33% 5.6Percentage of total debt 88% 12% 100%

(1) Represents the weighted-average interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted-average interest rate excludes bank fees and amortization of loan fees.

Summary of Debt (continued)December 31, 2015



Stated Rate

Weighted-AverageInterest Rate (1)

Maturity Date (2)

Principal Payments Remaining for the Periods Ending December 31,

Debt 2016 2017 2018 2019 2020 Thereafter TotalSecured notes payable

Greater Boston, New York City, and San Diego 5.82 % 5.82 %(3)

$ 29,471 $ — $ — $ — $ — $ — $ 29,471San Diego 5.74 3.00 (3) 6,916 — — — — — 6,916San Francisco L+1.40 1.83 6/1/16

(4)20,800 — — — — — 20,800

San Francisco L+1.50 1.93 7/1/16(5)

47,596 — — — — — 47,596San Francisco 6.35 6.35 8/1/16 126,715 — — — — — 126,715Maryland 2.42 2.42 1/20/17 — 76,000 — — — — 76,000Greater Boston L+1.35 1.77 8/23/17

(6)— 163,893 — — — — 163,893

Greater Boston L+1.50 1.83 1/28/19(7)

— — — 109,692 — — 109,692San Diego, Seattle, and Maryland 7.75 7.75 4/1/20 1,696 1,832 1,979 2,138 104,352 — 111,997San Diego 4.66 4.66 1/1/23 1,466 1,540 1,614 1,692 1,770 29,904 37,986Greater Boston 3.93 3.10 3/10/23 — — 1,091 1,505 1,566 77,838 82,000San Francisco 6.50 6.50 7/1/36 20 20 22 23 25 703 813

Unamortized premiums 610 573 588 595 601 1,371 4,338Secured notes payable weighted average/subtotal 3.92 % 3.84 235,290 243,858 5,294 115,645 108,314 109,816 818,217

$1.5 billion unsecured senior line of credit L+1.10 %(8)

1.62 1/3/19 — — — 151,000 — — 151,0002019 Unsecured Senior Bank Term Loan L+1.20 % 1.71 1/3/19 — — — 600,000 — — 600,0002021 Unsecured Senior Bank Term Loan L+1.10 % 1.52 1/15/21 — — — — — 350,000 350,000Unsecured senior notes payable 2.75 % 2.79 1/15/20 — — — — 400,000 — 400,000Unsecured senior notes payable 4.60 % 4.61 4/1/22 — — — — — 550,000 550,000Unsecured senior notes payable 3.90 % 3.94 6/15/23 — — — — — 500,000 500,000Unsecured senior notes payable 4.30 % 4.35 1/15/26 — — — — — 300,000 300,000Unsecured senior notes payable 4.50 % 4.51 7/30/29 — — — — — 300,000 300,000Unamortized discounts (428) (444) (461) (479) (339) (1,271) (3,422)Unsecured debt weighted average/subtotal 3.20 (428) (444) (461) 750,521 399,661 1,998,729 3,147,578Weighted average/total 3.33 % $ 234,862 $ 243,414 $ 4,833 $ 866,166 $ 507,975 $ 2,108,545 $ 3,965,795

Balloon payments $ 229,795 $ 239,893 $ — $ 860,692 $ 503,979 $ 2,100,487 $ 3,934,846Principal amortization 5,067 3,521 4,833 5,474 3,996 8,058 30,949Total consolidated debt $ 234,862 $ 243,414 $ 4,833 $ 866,166 $ 507,975 $ 2,108,545 $ 3,965,795

Fixed-rate/hedged variable-rate debt $ 166,465 $ 3,521 $ 4,833 $ 705,474 $ 507,975 $ 2,108,545 $ 3,496,813Unhedged variable-rate debt 68,397 239,893 — 160,692 — — 468,982Total consolidated debt $ 234,862 $ 243,414 $ 4,833 $ 866,166 $ 507,975 $ 2,108,545 $ 3,965,795

(1) Represents the weighted-average interest rate as of the end of the period plus the impact of debt premiums/discounts and our interest rate swap agreements. The weighted-average interest rate excludes bank fees and amortization of loan fees.(2) Reflects any extension options that we control.(3) In January 2016, we repaid two secured notes payable aggregating $36.4 million with a weighted average effective interest rate of 5.28%.(4) We have two, one-year options to extend the stated maturity date to June 1, 2018, subject to certain conditions.(5) We have an option to extend the stated maturity date to July 1, 2017, subject to certain conditions.(6) We have a one-year option to extend the stated maturity date to August 23, 2018, subject to certain conditions.(7) We have a two, one-year options to extend the stated maturity date to January 28, 2021, subject to certain conditions. (8) Our unsecured senior line of credit contains a feature that allows lenders to competitively bid on the interest rate for borrowings under the facility. This may result in an interest rate that is below the applicable margin of LIBOR+1.10%. In addition to the cost of

borrowing, the facility is subject to an annual facility fee of 0.20%, based on the aggregate commitments.

Summary of Debt (continued)December 31, 2015



Secured construction loans

Property/Market/Submarket Stated Rate Maturity DateOutstanding

BalanceRemaining

Commitments Total Commitments269 East Grand Avenue/San Francisco/South San Francisco L+1.40% 6/1/16 (1) $ 20,800 $ 15,200 $ 36,000259 East Grand Avenue/San Francisco/South San Francisco L+1.50% 7/1/16 (2) 47,596 7,404 55,00075/125 Binney Street/Greater Boston/Cambridge L+1.35% 8/23/17 (3) 163,893 86,507 250,40050/60 Binney Street/Greater Boston/Cambridge L+1.50% 1/28/19 (4) 109,692 240,308 350,000

$ 341,981 $ 349,419 $ 691,400

(1) We have two, one-year options to extend the stated maturity date to June 1, 2018, subject to certain conditions.(2) We have an option to extend the stated maturity date to July 1, 2017, subject to certain conditions.(3) We have a one-year option to extend the stated maturity date to August 23, 2018, subject to certain conditions.(4) We have a two, one-year options to extend the stated maturity date to January 28, 2021, subject to certain conditions.

Debt covenantsUnsecured Senior Notes Payable

Unsecured Senior Line of Credit andUnsecured Senior Bank Term Loans

Debt Covenant Ratios Requirement Actual Requirement ActualTotal Debt to Total Assets 39.7% 36.9%Secured Debt to Total Assets 8.0% 7.6%Consolidated EBITDA to Interest Expense 5.6x 3.21xUnencumbered Total Asset Value to Unsecured Debt 248.0% N/A N/AUnsecured Leverage Ratio N/A N/A 43.0%Unsecured Interest Coverage Ratio N/A N/A 5.58x

Interest rate swap agreementsNumber ofContracts

Weighted-Average Interest Pay Rate (1)

Fair Value as of12/31/15

Notional Amount in Effect as ofEffective Date Maturity Date 12/31/15 12/31/16 12/31/17

December 31, 2014 March 31, 2016 3 0.53% $ (94) $ 500,000 $ — $ —March 31, 2015 March 31, 2016 7 0.42% 33 450,000 — —September 1, 2015 March 31, 2017 2 0.57% 239 100,000 100,000 —March 31, 2016 March 31, 2017 11 1.15% (3,083) — 1,000,000 —March 31, 2017 March 31, 2018 11 1.51% (813) — — 650,000

$ (3,718) $ 1,050,000 $ 1,100,000 $ 650,000

(1) In addition to the interest pay rate for each swap agreement, interest is also payable at an applicable margin for borrowings outstanding as of December 31, 2015. Borrowings under our 2019 Unsecured Senior Bank Term Loan include an applicable margin of 1.20%, and borrowings outstanding under our 2021 Unsecured Senior Bank Term Loan and our unsecured senior line of credit include an applicable margin of 1.10%.

Definitions and ReconciliationsDecember 31, 2015


This section contains additional information for sections throughout this supplemental information package as well as explanations of certain non-GAAP financial measures and the reasons why we use these supplemental measures of performance. Our computation of non-GAAP measures may not be comparable to similar measures reported by other companies. Additional detail can be found in our most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q, as well as other documents filed with or furnished to the SEC from time to time.

Adjusted EBITDA

The following table reconciles net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to EBITDA and Adjusted EBITDA:

Three Months Ended

(In thousands) 12/31/15 9/30/15 6/30/15 3/31/15 12/31/14

Net income (loss) $ 42,977 $ 39,699 $ 38,430 $ 25,008 $ (6,030)

Net income attributable to noncontrolling interests (972) — — — —

Interest expense:

Consolidated 28,230 27,679 26,668 23,236 22,188

NCI share of consolidated JVs — — — — —

Our share of unconsolidated JVs 703 242 38 4 35

Interest expense 28,933 27,921 26,706 23,240 22,223

Income taxes 2,160 1,392 1,324 1,122 —

Depreciation and amortization:

Consolidated 72,245 67,953 62,171 58,920 57,973

NCI share of consolidated JVs (372) — — — —


Depreciation and amortization 72,528 68,398 62,523 59,202 58,302

EBITDA 145,626 137,410 128,983 108,572 74,495

Stock compensation expense 4,590 5,178 4,054 3,690 4,624

Loss on early extinguishment of debt — — 189 — —

Gain on sales of real estate:

Rental properties (12,426) — — — (1,838)

Land parcels — — — — (5,598)

Impairment of real estate 8,740 — — 14,510 51,675

Adjusted EBITDA $ 146,530 $ 142,588 $ 133,226 $ 126,772 $ 123,358

EBITDA represents earnings before interest, taxes, depreciation, and amortization. EBITDA is a non-GAAP financial measure and is used by us and others as a supplemental measure of performance. We use adjusted EBITDA (“Adjusted EBITDA”) to assess the performance of our operations, including our pro rata share of amounts from consolidated and unconsolidated real estate joint ventures, for financial and operational decision making, and as a supplemental or additional means of evaluating period-to-period comparisons on a consistent basis. Adjusted EBITDA is calculated as EBITDA, excluding stock compensation expense, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, and impairments. We believe Adjusted EBITDA provides investors relevant and useful information because it permits investors to view income from our operations on an unleveraged basis before the effects of taxes, depreciation and amortization, stock compensation expense, gains or losses on early extinguishment of debt, gains or losses on sales of real estate, and impairments.

Adjusted EBITDA margins

Our total revenues exclude revenues from discontinued operations, and for the purposes of calculating the Adjusted EBITDA margin ratio, we exclude Adjusted EBITDA from our discontinued operations to improve the consistency and comparability from period to period. Likewise, our Adjusted EBITDA is presented on a pro rata basis, including our share of Adjusted EBITDA from consolidated and unconsolidated real estate joint ventures. Therefore, revenues are presented with only our pro rata share of revenues from consolidated and unconsolidated real estate joint ventures to improve the consistency and comparability from period-to-period.

The following table reconciles Adjusted EBITDA to Adjusted EBITDA – excluding discontinued operations:

Three Months Ended

(Dollars in thousands) 12/31/15 9/30/15 6/30/15 3/31/15 12/31/14

Adjusted EBITDA $ 146,530 $ 142,588 $ 133,226 $ 126,772 $ 123,358

Add back: operating loss from discontinued operations — — — 43 116

Adjusted EBITDA – excluding discontinued operations $ 146,530 $ 142,588 $ 133,226 $ 126,815 $ 123,474

Revenues:

Consolidated $ 223,955 $ 218,610 $ 204,156 $ 196,753 $ 188,674

NCI share of consolidated JVs (1,403) — — — —

Our share of unconsolidated JVs 2,012 1,875 1,324 — —

Revenues $ 224,564 $ 220,485 $ 205,480 $ 196,753 $ 188,674

Adjusted EBITDA margins 65% 65% 65% 64% 65%

Adjusted funds from operations attributable to Alexandria’s common stockholders

AFFO is a non-GAAP financial measure that we use as a supplemental measure of our performance. We compute AFFO to include only our share of amounts from consolidated and unconsolidated real estate joint ventures. AFFO excludes certain items that are not representative of our operating results because such items are dependent upon historical costs or are subject to judgmental valuation inputs and the timing of our decisions.

AFFO is not intended to represent cash flow for the period, and is intended only to provide an additional measure of performance. We believe that net income (loss) attributable to Alexandria’s common stockholders is the most directly comparable GAAP financial measure to AFFO. We believe that AFFO is a widely recognized measure of the operations of equity REITs, and presenting AFFO will enable investors to assess our performance in comparison to other equity REITs. However, other equity REITs may use different methodologies for calculating AFFO, and, accordingly, our AFFO may not be comparable to AFFO calculated by other equity REITs. AFFO should not be considered as an alternative to net income (loss) (determined in accordance with GAAP) as an indication of financial performance, or to cash flows from operating activities (determined in accordance with GAAP) as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to make distributions.

Definitions and Reconciliations (continued)December 31, 2015


Annualized base rent

Annualized base rent means the annualized fixed base rental amount in effect as of the end of the period, related to our operating rentable square feet (using rental revenue computed on a straight-line basis in accordance with GAAP). Annualized base rent and measures computed using annualized base rent are presented at 100% for all properties under our management, including properties held by our consolidated and unconsolidated real estate joint ventures.

Average cash yield

See definition of initial stabilized yield (unlevered).

Cash interest

Cash interest is equal to interest expense calculated in accordance with GAAP, plus capitalized interest, less amortization of loan fees and debt premiums/discounts. See definition of fixed-charge coverage ratio for a reconciliation of interest expense, the most directly comparable GAAP financial measure, to cash interest.

Construction in progress

A key component of our business model is our development and redevelopment projects under construction. These projects are focused on providing high-quality, generic, and reusable space to meet the real estate requirements of and are reusable by a wide range of tenants. We also have certain significant value-creation projects undergoing important and substantial predevelopment activities to bring these assets to their intended use. These critical activities add significant value and are required for the construction of buildings. Upon completion, each value-creation project is expected to generate significant revenues and cash flows. Our development and redevelopment projects are generally in locations that are highly desirable to high-quality entities, which we believe result in higher occupancy levels, longer lease terms, and higher rental income and returns. Development projects generally consist of the ground-up development of generic and reusable facilities. We generally will not commence new development projects for aboveground construction of Class A space without first securing pre-leasing for such space except when there is significant market demand for high-quality Class A facilities. Redevelopment projects consist of the permanent change in use of office, warehouse, and shell space into office/laboratory or tech office space.

Class A assets and AAA locations Class A assets are properties clustered in AAA locations that provide innovative tenants with high- quality, dynamic, and collaborative ecosystems that enhance their ability to successfully recruit and retain world-class talent and inspire productivity, efficiency, creativity, and success. Class A assets generally command higher ABR than other classes of properties. AAA locations are in close proximity to concentrations of specialized skills, knowledge, institutions, and related businesses. Such locations are characterized by high barriers to entry for new landlords, high barriers to exit for tenants, and a limited supply of available space.

Dividend payout ratio

Dividend payout ratio (common stock) is the ratio of the absolute dollar amount of dividends on our common stock (shares of common stock outstanding on the respective record date multiplied by the related dividend per share) to FFO attributable to Alexandria’s common stockholders on a diluted basis, as adjusted.

Dividend yield

Dividend yield for the quarter represents the annualized quarter dividend divided by the closing common stock price at the end of the quarter.

Fixed-charge coverage ratio

Fixed-charge coverage ratio is a supplemental measure of our ability to satisfy fixed financing obligations and preferred stock dividends. We compute the fixed charge coverage ratio, on a pro rata basis to include only our share of amounts from consolidated and unconsolidated real estate joint ventures. The following table presents a reconciliation of interest expense, the most directly comparable GAAP financial measure to cash interest and fixed charges:

Three Months Ended


Adjusted EBITDA $ 146,530 $ 142,588 $ 133,226 $ 126,772 $ 123,358

Interest expense:

Consolidated $ 28,230 $ 27,679 $ 26,668 $ 23,236 $ 22,188



Interest expense 28,933 27,921 26,706 23,240 22,223

Capitalized interest:

Consolidated 8,696 8,436 8,437 10,971 11,665


Our share of unconsolidated JVs — 641 617 588 —

Capitalized interest 8,696 9,077 9,054 11,559 11,665

Amortization of loan fees:

Consolidated (2,654) (2,625) (2,889) (2,834) (2,819)


Our share of unconsolidated JVs (35) (32) (32) (1) (3)

Amortization of loan fees (2,689) (2,657) (2,921) (2,835) (2,822)

Amortization of debt premiums (discounts) 90 100 100 82 (17)

Cash interest 35,030 34,441 32,939 32,046 31,049

Dividends on preferred stock 6,246 6,247 6,246 6,247 6,284

Fixed charges $ 41,276 $ 40,688 $ 39,185 $ 38,293 $ 37,333

Fixed-charge coverage ratio:

– quarter annualized 3.6x 3.5x 3.4x 3.3x 3.3x

– trailing 12 months 3.4x 3.4x 3.3x 3.3x 3.3x



Funds from operations and funds from operations, as adjusted (attributable to Alexandria’s common stockholders)

FFO is a widely used non-GAAP financial measure among equity REITs. We believe that FFO is helpful to investors as an additional measure of the performance of an equity REIT. Moreover, we believe that FFO, as adjusted, allows investors to compare our performance to the performance of other real estate companies on a consistent basis, without having to account for differences caused by investment and disposition decisions, financing decisions, terms of securities, capital structures, and capital market transactions. We compute FFO in accordance with standards established by the NAREIT Board of Governors in its April 2002 White Paper and related implementation guidance. Impairment write-downs of depreciable real estate are added back to net income for our computation of FFO, in accordance with NAREIT guidance. We compute FFO, as adjusted, as FFO calculated in accordance with the NAREIT White Paper less/plus significant gains/losses on the sale of investments, plus losses on early extinguishment of debt, preferred stock redemption charges, impairments of non-depreciable real estate and land parcels, impairments of investments, and the amount of such items that is allocable to our unvested restricted stock awards. Neither FFO nor FFO, as adjusted, should be considered as an alternative to net income (loss) (determined in accordance with GAAP) as an indication of financial performance, or to cash flows from operating activities (determined in accordance with GAAP) as a measure of liquidity, nor are they indicative of the availability of funds for our cash needs, including our ability to make distributions.

Initial stabilized yield (unlevered)

Initial stabilized yield is calculated as the quotient of the estimated amounts of NOI and our investment in the property. Our initial stabilized yield excludes the impact of leverage. Our cash rents related to our value-creation projects are expected to increase over time, and our average cash yields are expected, in general, to be greater than our initial stabilized yields on a cash basis. Our estimates for initial yields, initial yields on a cash basis, and total costs at completion represent our initial estimates at the commencement of the project. We expect to update this information upon completion of the project, or sooner, if there are significant changes to the expected project yields or costs.

• Initial stabilized yield reflects rental income less straight-line rent, including contractual rent escalations and any rent concessions over the term(s) of the lease(s), calculated on a straight-line basis.

• Initial stabilized yield (cash basis) reflects cash rents at the stabilization date after initial rental concessions, if any, have elapsed.

Average cash yield reflects cash rents, including contractual rent escalations after initial rental concessions have elapsed, calculated on a straight-line basis.

Net debt to Adjusted EBITDA

Net debt to Adjusted EBITDA is a non-GAAP financial measure that we believe is useful to investors as a supplemental measure in evaluating our balance sheet leverage. We compute the net debt to adjusted EBITDA ratio, on a pro rata basis and to include only our share of amounts from consolidated and unconsolidated real estate joint ventures. The following table reconciles net debt to Adjusted EBITDA:


Secured notes payable:

Consolidated $ 818,217 $ 773,619 $ 771,435 $ 760,476 $ 652,209


Our share of unconsolidated JVs 48,726 48,215 46,896 45,778 —

Secured notes payable 866,943 821,834 818,331 806,254 652,209

Unsecured senior notes payable 2,046,578 1,747,613 1,747,531 1,747,450 1,747,370

Unsecured senior line of credit 151,000 843,000 624,000 421,000 304,000

Unsecured senior bank term loans 950,000 950,000 950,000 975,000 975,000

Cash and cash equivalents:

Consolidated (125,098) (76,383) (68,617) (90,641) (86,011)

NCI share of consolidated JVs 1,385 — — — —

Our share of unconsolidated JVs (4,209) (7,231) (4,006) (5,186) —

Cash and cash equivalents (127,922) (83,614) (72,623) (95,827) (86,011)

Less: restricted cash (28,872) (36,993) (44,191) (56,704) (26,884)

Net debt $ 3,857,727 $ 4,241,840 $ 4,023,048 $ 3,797,173 $ 3,565,684

Adjusted EBITDA:

– quarter annualized $ 586,120 $ 570,352 $ 532,904 $ 507,088 $ 493,432

– trailing 12 months $ 549,116 $ 525,944 $ 501,827 $ 481,743 $ 468,492

Net debt to Adjusted EBITDA:

– quarter annualized 6.6x 7.4x 7.5x 7.5x 7.2x

– trailing 12 months 7.0x 8.1x 8.0x 7.9x 7.6x



NOI

The following table reconciles income from continuing operations to total net operating income:

Three Months Ended Year Ended

(In thousands) 12/31/15 12/31/14 12/31/15 12/31/14

Income from continuing operations $ 42,977 $ (13,350) $ 146,157 $ 99,142

General and administrative 15,101 13,861 59,620 53,530

Interest 28,933 22,223 106,800 79,334

Depreciation and amortization 72,528 58,302 262,651 224,425

Impairment of real estate 8,740 51,675 23,250 51,675

Loss on early extinguishment of debt — — 189 525

Gain on sales of real estate – rental properties (12,426) — (12,426) —

Net income attributable to nonredeemablenoncontrolling interests (675) — (675) —

Total net operating income $ 155,178 $ 132,711 $ 585,566 $ 508,631

NOI is a non-GAAP financial measure equal to income from continuing operations, the most directly comparable GAAP financial measure, excluding loss on early extinguishment of debt, impairment of real estate, depreciation and amortization, interest, and general and administrative expense. These amounts are presented to include our pro rata share of amounts from consolidated and unconsolidated real estate joint ventures. We believe NOI provides useful information to investors regarding our financial condition and results of operations because it reflects primarily those income and expense items that are incurred at the property level. Therefore, we believe NOI is a useful measure for evaluating the operating performance of our real estate assets, including only our pro rata share of amounts from consolidated and unconsolidated real estate joint ventures. NOI on a cash basis is NOI adjusted to exclude the effect of straight-line rent and amortization of below-market lease revenue adjustments required by GAAP. We believe that NOI on a cash basis is helpful to investors as an additional measure of operating performance because it eliminates straight-line rent and amortization of below-market lease revenue adjustments to rental revenue.

Further, we believe NOI is useful to investors as a performance measure because, when compared across periods, NOI reflects the impact on operations from trends in occupancy rates rental rates, and operating costs, and provides perspective not immediately apparent from income from continuing operations. NOI presented by us may not be comparable to NOI reported by other equity REITs, which may define NOI differently. We believe that in order to facilitate a clear understanding of our operating results, NOI should be examined in conjunction with income from continuing operations as presented in our consolidated statements of income. NOI should not be considered as an alternative to income from continuing operations as an indication of our performance, nor as an alternative to cash flows as a measure of liquidity, or our ability to make distributions.

Operating statistics

We present certain operating statistics related to our properties, including number of properties, ABR, ABR per occupied RSF, occupancy, RSF, leasing activity, rental rates, and contractual lease expirations. We believe these measures are useful to investors because they facilitate an understanding of certain trends for our properties. We compute operating statistics at 100% of properties managed by us, including properties owned by our consolidated and unconsolidated real estate joint ventures.

Pro rata Information

We present certain items, including NOI, same property NOI, and unencumbered NOI, on a pro rata basis. We believe this information is useful to investors as a supplemental measure of operating performance because it provides greater detail of the results most impacting to our common stockholders. Moreover, this information provides our share of investments in real estate from all properties, including our share of the assets and liabilities of our real estate joint ventures. This information also allows investors to understand the impact of real estate joint ventures investments and debt on our business.

In addition, we present certain credit metrics, including Adjusted EBITDA, Adjusted EBITDA margins, net debt to adjusted EBITDA, and fixed charge coverage ratios on a pro rata basis. We believe this information is useful to investors as a supplemental measure because it excludes amounts that may not be available to our common stockholders.

Stabilized occupancy date

The stabilized occupancy date represents the estimated date on which the project is expected to reach occupancy of 95% or greater.

Same property comparisons

As a result of changes within our total property portfolio during the comparative periods presented, including changes from assets acquired or sold, properties placed into development or redevelopment, and development and/or redevelopment properties recently placed into service, the consolidated total rental revenues, tenant recoveries, and rental operating expenses in our operating results can show significant changes from period to period. In order to supplement an evaluation of our results of operations over a given period, we analyze the operating performance for all properties, including only our pro rata share of amounts from consolidated and unconsolidated real estate joint ventures, for comparable properties, referred to as same properties, that were fully operating for the entirety of the comparative periods presented. These properties are analyzed separately from properties acquired subsequent to the first day in the earliest comparable period presented, properties that underwent development or redevelopment at any time during the comparative periods and corporate entities (legal entities performing general and administrative functions), which are excluded from same property results. Additionally, rental revenues from lease termination fees, if any, are excluded from the results of the same properties.



The following table reconciles the number of same properties to total properties:

Development – under construction Properties50/60 Binney Street 2100 Binney Street 1510 Townsend Street 1505 Brannan Street 13013/3033 Science Park Road 2430 East 29th Street 15200 Illumina Way, Building 6 14796 Executive Drive 1400 Dexter Avenue North 1360 Longwood Avenue

(unconsolidated joint venture) 11455/1515 Third Street

(unconsolidated joint venture) 214

Development – placed into serviceafter January 1, 2014 Properties

75/125 Binney Street 1499 Illinois Street 1269 East Grand Avenue 16040 George Watts Hill Drive 1

4Redevelopment – under

construction Properties11 Hurley Street 110290 Campus Point Drive 19625 Towne Centre Drive 110151 Barnes Canyon Road 1

4Redevelopment – placed into

service after January 1, 2014 Properties225 Second Avenue 111055/11065/11075 Roselle Street 310121 Barnes Canyon Road 1

5

Summary PropertiesProperties under construction:

Development 14Redevelopment 4

Projects placed into service afterJanuary 1, 2014:

Development 4Development – Asia 2Redevelopment 5

Acquisitions after January 1, 2014:3545 Cray Court 14025/4031/4045 Sorrento Valley Boulevard 3640 Memorial Drive 1

Properties “held for sale” 1Total properties excluded from same

properties 35

Same properties 164

Total properties as of theyear ended December 31, 2015 199

Total equity market capitalization

Total equity market capitalization is equal to the sum of outstanding shares of Series D cumulative convertible preferred stock, Series E cumulative convertible preferred stock and common stock multiplied by the related closing price of each class at the end of each period presented.

Total market capitalization

Total market capitalization is equal to the sum of total equity market capitalization and total debt.

Unencumbered NOI as a percentage of total net operating income

Our share of unencumbered NOI as a percentage of our share of total net operating income is a non-GAAP financial measure that we believe is useful to investors as a performance measure of the results of operations of our unencumbered real estate assets; as it reflects primarily those income and expense items that are incurred at the unencumbered property level. We use our share of unencumbered NOI as a percentage of our share of total net operating income in order to assess our compliance with our financial covenants under our debt obligations because the measure serves as a proxy for a financial measure under such debt obligations. Our share of unencumbered NOI is derived from assets classified in continuing operations, including our pro rata share of amounts from consolidated and unconsolidated real estate joint ventures, which are not subject to any mortgage, deed of trust, lien, or other security interest; as of the period for which income is presented.

Three Months Ended Year Ended

(Dollars in thousands) 12/31/15 9/30/15 6/30/15 3/31/15 12/31/14 12/31/15 12/31/14

Our share of unencumberedNOI $ 124,982 $ 118,889 $ 110,820 $ 111,957 $ 111,741 $ 466,648 $ 426,943

Our share of encumberedNOI 30,196 32,272 32,017 24,433 20,970 118,918 81,688

Our share of total NOI $ 155,178 $ 151,161 $ 142,837 $ 136,390 $ 132,711 $ 585,566 $ 508,631

Unencumbered NOI as apercentage of total NOI 81% 79% 78% 82% 84% 80% 84%

Weighted-average interest rate for capitalization of interest

The weighted-average interest rate required for calculating capitalization of interest pursuant to GAAP represents a weighted-average rate based on the rates applicable to borrowings outstanding during the period and includes the impact of our interest rate swap agreements, amortization of debt discounts/premiums, amortization of loan fees, and other bank fees. A separate calculation is performed to determine our weighted-average interest rate for capitalization for each month. The rate will vary each month due to changes in variable interest rates, outstanding debt balances, the proportion of variable-rate debt to fixed-rate debt, the amount and terms of interest rate swap agreements, and the amount of loan fee amortization.

The following table presents the weighted-average interest rate for capitalization of interest:

Three Months Ended

12/31/15 9/30/15 6/30/15 3/31/15 12/31/14

Weighted-average interest rate for capitalization of interest 3.37% 3.34% 3.45% 3.54% 3.69%

Documents

4Q15 EX 99 - ARETitle 4Q15 EX 99.1 Created Date 20160210737